Electricity hikes

The announcement of an electricity bill increase last week by President Ouattara during a visit to Odienne in the far north-west quickly provoked a strong reaction on social media. Beyond the fact that no-one likes to see their utility bills go up, April saw large-scale disruption to the electricity supply in Abidjan as repairs were carried out, leaving bill-payers already frustrated.

Ivorian blogger Yehni Djidji gives a very articulate account of the arguments against the price hike on her blog, namely that:

– the service offered by the national electricity company, CIE, is subject to frequent interruptions i.e. sub-standard

– that the bills already include extra charges like payment for public tv (poor quality) and waste collection (which doesn’t happen in her area)

– that it will bring further suffering on poor households

– that a price hike represents a failure of government, which can no longer be excused by the conflict or the previous poor management of the former regime

– that it shows the government is out of touch

– that Cote d’Ivoire sells electricity to neighbouring countries where customers pay less for their electricity

In response to these complaints, the government already seems to have pushed back the introduction of these charges from 1 June till 1 July. Of course no-one knows how much the prices will rise by, which suggests that the government is testing the water on the subject, which should encourage those wanting to protest the hikes.

There are nevertheless some arguments on the government side (made here), which are worth reiterating, as few people seem to be making them elsewhere.

– 40% of (the poorest) subscribers won’t be touched by the rise (around 522,000) so those least able to pay won’t be hurt by this

– the government wants to avoid Cote d’Ivoire falling into the same trap as other countries who haven’t had the political courage to reduce energy subsidies and so have derailed their economies

– that Cote d’Ivoire has one of the best electricity supplies in Africa, with only 40h lost to cuts a year, less than South Africa (42h). That for coverage it is number 3 in Africa after South Africa and Morocco.

– that considerable investment is taking place in the electricity sector, taking production from 1100 MW in 2011, to 1900 MW.

(All figures above not verified)

The fact that this is being announced just months before the election indicates that i) the government is not afraid of making unpopular decisions, ii) it sees the election as a foregone conclusion.

The Africa Progress Report due to be launched on 5 June argues that power is crucial for jobs, growth and reducing poverty. As someone who is unlikely to have an issue paying my future electricity bill in Abidjan, I realise I cannot speak for the majority of Ivorians for whom this will eat into already low incomes. But if we really want Cote d’Ivoire to become an emerging economy, it will need:

– pro poor policies

– a stable electricity supply to create conditions for industrialisation

There has been considerable investment in electricity, which – provided it has been done wisely and without mismanagement or incompetence – will continue to support a power supply that is far above what most Africans on the continent experience. I am writing from Freetown where only those with generators can really count on having power (and almost no-one in Abidjan has a generator, which speaks volumes). Improvements have costs, that can either by financed by debts, or by the end users. The gamble is that we pay a little more and benefit from a world class power network.

 

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