Government cushions bulk electricity increase

The chief executive officer of the Electricity Control Board (ECB), Robert Kahimise, announced on Monday that the government has stepped in to soften the impact of the annual adjustment to NamPower's bulk electricity tariffs.

From 1 August 2026, the bulk tariff will increase by 3.7%.

According to Kahimise, NamPower had applied for an 8.4% increase in its bulk tariff, covering both electricity generation and transmission.

Following a rigorous review that assessed factors including exchange rate fluctuations, NamPower's financial position and long-term sustainability, as well as the broader economic implications of the proposed adjustment, the ECB Board approved a moderated bulk tariff increase of 4.8%. The review also included public consultations during which NamPower presented its application.

However, Kahimise said Minister of Industries, Mines and Energy Natangwe Ithete, acting through the ministry, committed N$90 million to cushion consumers. This comprises N$40 million from the National Energy Fund (NEF) and N$50 million from the Long-Run Marginal Cost Fund (LRMCF), effectively reducing the increase passed on to customers to 3.7%.

"As a result, the increase passed to customers will be 3.7%," he said.

Consequently , instead of Namibian customers paying N$2.23 per kilowatt-hour (kWh) from next month, up from the current N$2.06/kWh, the new tariff will be N$2.14/kWh.

Intervention

"The ECB wishes to draw particular attention to the social dimension of this intervention. Electricity is not a luxury. Among other things, it lights homes, keeps clinics and schools running, and sustains the small businesses on which many livelihoods depend. In the absence of government's cushioning support, consumers would have carried the full weight of the 4.8% adjustment," Kahimise said.

"By stepping in, the government has shouldered a substantial share of the cost pressure on behalf of the nation, sparing households, especially low-income and vulnerable families, as well as small and medium-sized enterprises, from a far steeper increase."

He added: "This gesture reflects government's ongoing resolve to keep electricity within reach of all Namibians while, at the same time, safeguarding the financial viability of the utilities that must deliver it. The ECB acknowledges that this is a deliberate act of solidarity with consumers during a period of economic strain."

Kahimise said the ECB had not only decided to release the N$50 million from the LRMCF, but had also directed electricity distributors to keep all social tariffs unchanged within their respective jurisdictions.

He said the zero adjustment to social tariffs was "intended to provide relief to electricity customers, particularly vulnerable members of society who rely on social tariffs".

Apart from the Erongo Region, where social tariffs specifically target pensioners, low-volume electricity users generally benefit from social tariffs, he explained.

Cushion

Speaking at the same event at ECB House on Monday, 20 July 2026, the regulator's Executive for Economic and Market Regulation, Pinehas Mutota, explained that the LRMCF had been built up over the previous four to five years. It has already been used to support initiatives such as the Omburu photovoltaic solar power plant.

Mutota said that, after the contribution to cushion the bulk electricity tariff increase, the LRMCF would retain about N$80 million. He added that the NEF is replenished annually through levies of between N$40 million and N$50 million and is also used to support other initiatives, including electrification projects, when required.