Parliament grants six-month period to lower billing rates of electricity in islands

Parliament, on Monday, passed the report by its State-Owned Enterprises (SOE) Committee which grants a six-month period to unify the billing rates of electricity provided in the Male’ area by STELCO, and electricity provided by Fenaka Corporation in the islands.

The report was formulated on the resolution was submitted to the Parliament by Thoddoo MP Hassan Shiyan – calling to eliminate discrimination in the billing rates and banding with regards to electricity services provided for businesses in Male’ area and atolls.

In the last sitting of the last session for the year held on Tuesday – SOE Committee’s report on the resolution was passed by the unanimous votes of 56 MPs in attendance.

As per the resolution– MVR 3.65 is charged by STELCO for 200 to 300 units of electricity in Male’ area. Meanwhile, Fenaka charges MVR 6 for the same range of units in islands. MVR 3.65 is charged by STELCO for 100 to 200 units of electricity in Male’ area. Meanwhile, Fenaka charges MVR 3.35 for the same range of units in the islands.

SoE Committee sought the opinion of STELCO, Fenaka, MWSC and Environment Ministry regarding the resolution.

When senior officials from STELCO and Fenaka were summonsed to the Committee – they said passing the resolution would result in significant financial losses to the companies. In this regard, STELCO estimated a loss of MVR 35 million per year, whilst Fenaka estimated a loss of MVR 41.2 million per year.

Therewith, the Committee decided to grant a six-month period to undertake efforts to unify the billing rates of electricity, alongside three other recommendations they passed.

These recommendations include identifying the direct impact of tariff, conducting a comprehensive tariff review on providing electricity services to businesses at the same right, and inquiring how the tariff rates may be decreased through additional resources.

They also recommended unifying billing rates for water and sewerage services by next year’s June.

MP Shiyan’s resolution underscored the increasing concerns and complaints by small businesses based in islands operating guesthouses, dive centers, hotels, restaurants and local shops facing many difficulties due to the discrimination in billing for electricity including decrease in profit.