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The Electricity Control Board (ECB) has approved a 3.8% increase in NamPower’s bulk electricity tariff for the 2025/2026 financial year significantly lower than the 17.44% originally requested by the national utility. The decision comes after extensive internal reviews and stakeholder consultations, reflecting the ECB’s balancing act between financial sustainability, affordability, and national economic stability.
NamPower initially applied for an increase that would have seen the bulk tariff rise from N$1.9856 to N$2.3319 per kilowatt-hour (kWh). The utility argued that the hike was necessary to meet its revenue requirement covering the full spectrum of operational costs, including generation, transmission, maintenance, salaries, and infrastructure depreciation.
The ECB, acting in its regulatory capacity, conducted a thorough evaluation of the application. This included economic and financial impact assessments, analysis of local electricity generation versus imports, and public consultations across the country. As a result of this process, NamPower’s revenue requirement was revised downward from N$8.8 billion to N$8.1 billion.
In finalising the approved increase, the ECB also took into account the government’s decision to provide N$283 million in financial support to NamPower. This support effectively absorbs part of the cost burden, cushioning consumers against the full brunt of the hike. The adjusted average tariff now stands at N$2.0611 per kWh for the upcoming financial year.
While the increase is slightly below the inflation rate of 4.2% recorded in March 2025, its economic implications are expected to be minimal in terms of overall price increases for goods and services. However, the ECB acknowledged that electricity costs do play a role in GDP growth, and any upward adjustment can have ripple effects.
Several factors influenced the tariff determination. Key among them was the revaluation of NamPower’s transmission regulatory asset base, which rose from N$14.55 billion to N$21.4 billion an increase that directly impacts returns and depreciation calculations. Additionally, the cost of imported electricity, which makes up nearly a third of total generation expenses and is priced in US dollars, continues to expose NamPower to exchange rate volatility.
The ECB also factored in the N$963 million over-recovery from the 2023/2024 period, primarily due to higher-than-expected generation from the Ruacana Hydropower Plant. This surplus was used to reduce the required revenue for 2025/2026, offering some relief to consumers.
The new bulk tariff applies to NamPower’s key customers, including Regional Electricity Distributors (REDs), local authorities, regional councils, and large industrial users such as mines. Each distribution utility is required to submit its own tariff adjustment application to the ECB. If approved in time, these changes will take effect for end consumers starting 1 July 2025.
To ensure transparency and allow public participation, a series of regional consultations have been scheduled for June. These meetings will offer electricity users across the country a platform to engage directly with their local utilities about proposed tariff changes. The ECB believes these consultations are vital for enhancing consumer understanding and accountability in the electricity pricing process.
With the approval of the 3.8% increase, the ECB has reiterated its confidence in NamPower’s financial sustainability, particularly in light of the state’s intervention and prudent adjustments to the utility’s revenue expectations. The decision underscores the importance of balancing sector stability with the national imperative of affordable, reliable power especially for high energy sectors like mining, which remain integral to Namibia’s economic growth.
