By Thoboloko Ntšonyane
MASERU
In a world that is increasingly driven by energy and power demands the Lesotho Electricity and Water Authority (LEWA) has highlighted the potential challenges to these commodities in the country.
This is reflected in the LEWA’s Annual Report 2023/24.
The load shedding in South Africa is reportedly a persistent threat to districts of Mokhotlong and Qacha’s Nek whose electricity supply is from that country. Until they are fully integrated into the national grid, their power challenges persist.
The business community in the Mokhotlong and Qacha’s Nek have previously complained about how unstable power supply affect their operations. Some went to show how they have also invested in securing generators that are powered once the power goes off and this they said have made them incur unnecessary expenses thereby compromising their profits.
The car wash, food outlets and beauty industries are also some of the businesses that have felt pinch owing to unstable water supply in Mafeteng which is battling water crisis.
When utilities are dependable, businesses community said it is able plan and budget effectively, avoiding losses caused by unexpected outages.
The report has also highlighted that the urban water and sewerage services, overseen by the Water and Sewerage Company (WASCO), continue to face challenges. Non-Revenue Water (NRW) remains a critical issue, bleeding resources and impeding infrastructure expansion.
It says that in the past year, WASCO’s NRW stood as a significant constraint on its ability to provide reliable services, prompting the regulator to push for the development of a comprehensive NRW Reduction Strategy.
LEWA also said it is concerned by the delays in expansion of its regulatory mandate to include all forms of energy and sanitation.
LEWA is charged with regulating and overseeing the electricity and water sectors to ensure reliable, efficient, and affordable services for the nation.
According to the report, Lesotho’s total installed generation capacity reached 104.7 MW by the end of the financial year, with contributions from various sources including the 72 MW ‘Muela Hydropower Plant and the newly operational 30 MW Solar PV Plant at Ha Ramarothole in Mafeteng. This marks an increase from 74.7 MW in previous years, this move saw demonstrating a bolstering of energy security.
LEWA further reports that it has extended a conditional license for another 20 MW solar project, expected to further strengthen the national grid.
“Renewable energy has been widely regarded as a solution leading to a more sustainable future,” noted the Board Chairperson, emphasising the Authority’s highlighting the clean energy as a pathway to improving power supply reliability.
Electricity remains a cornerstone of Lesotho’s economy. The Lesotho Electricity Company (LEC) reported a revenue requirement (RR) of M2.09 billion for the 2023/24 fiscal year, but tariffs were only adjusted in April 2024 following a review.
The delayed tariff adjustments have reportedly resulted in an under-recovery of M109.89 million, a shortfall that poses financial risks to the utility.
LEWA reported that it has approved a 9.6% increase in energy charges for 2024/25 and 2025/26, balancing the need for affordability with the sustainability of utility providers. These adjustments aim to mitigate economic disruptions caused by power interruptions, which significantly affect industries and small businesses reliant on stable electricity.
WASCO’s revenue requirement for 2023/24 was set at M268.90 million, reflecting approved tariff increases of 4.9% for water volumetric charges and 1.6% for sewerage services. However, full cost recovery for new water connections was deferred pending a comprehensive study.
Meanwhile, LEWA noted that it remains concerned with non-compliance by both WASCO and LEC.
LEWA’s Chief Executive, Motlatsi Ramafole complained that: “The Authority noted non-compliance mainly by LEC and WASCO. Some of non-compliance areas include delays in remitting customer and rural electrifications levies, delayed implementation of recommendations from inspection and audit findings as well as effecting new connections. LEC failed to implement the Electricity Connection Charges Guidelines regarding pioneer developers, as directed by LEWA. WASCO failed to meet most of its KPIs [key performance indicators], including reduction of NRW. The Authority will continue to engage utilities on these and other matters.
On the Authority’s performance, he noted thus: “The Authority experienced several setbacks that compromised its ability to optimally discharge its duties and functions. These challenges that were encountered include non-compliance of WASCO and LEC, delays in obtaining policy clearance to enable expansion to regulate water services and all forms of energy and sanitation, and failure to implement connection guidelines, amongst other things. Overall, LEWA’s performance for the period under review was satisfactory, although it could have been better had it not been for the challenges encountered.”
The report has also hinted at the anticipated Energy Bill 2024 and the Water Services and Sanitation Bill 2024. These legislative frameworks are expected to ensure that Lesotho’s utilities meet the growing demands of its population while maintaining economic sustainability.