E.P.C. claim inability to meet targets

The submission of the E.P.C.’s Annual Report for approval by Members of Parliament last week raised several contentious issues. 

One that was discussed by the Parliamentary Committee was about the huge reduction of the cost of electricity as approved by Cabinet. 

The E.P.C. responded that it is unable to achieve both targets of meeting its obligation of 7% Return on Equity (R.O.E.) under Public Finance Management Act 2001, and at the same time, reduce the cost of electricity for the country. 

If the Corporation has to meet its 7% (R.O.E.) obligation the cost of electricity should be increased, they said. 

However for the financial year (2016-2017), Cabinet approved reduction in electricity tariff effective 1st August 2016. 

The Prime Minister pointed out that electricity is one of the backbone services for the development of Samoa. 

“If the cost of electricity is reduced, the whole country and all sectors will benefit,” he said firmly. 

Prime Minister Tuilaepa Sailele Malielegaoi has also instructed the Electric Power Corporation (E.P.C.) management to look into conducting regular inspections to check the stability of the electricity poles. 

Tuilaepa’s concern was raised upon reading of the $2.1 million tala that was paid out to a family following an incident where an electricity pole fell onto a car and killed a man. 

The incident occurred some 10 years ago. 

He pointed out the government does not have insurance to cover general public/third party for liability.  

However the government had set aside $2.5million tala specifically for this purpose. He said that following the incident, a total amount of $2.13million was paid to the man’s family for damages. 

He urged the E.P.C. to take bold steps to ensure these incidents are not repeated. “The family was from Australia and they wanted more money but, it was negotiated down to this amount and although this happened a long time ago, we should learn from it. 

“This was a significant amount of money and this can be avoided by checking the poles to determine whether they are grounded properly,” said Tuilaepa. 

Another issue discussed was the continuation of the installation of prepaid meters for Government Ministries. 

As of August 2016, a total of 61 Government Ministries were on prepaid meters and 381 on post-paid (readable) meters. 

Tuilaepa indicated that E.P.C. is continuing with the installation of prepaid meters for the remaining Ministries and organizations except for the National Health Services and some Ministries with higher consumption and demand for electricity, in which no prepaid meter is available in the market. 

“Further the E.P.C. is continuing with the implementation of the Storage and Smart Systems Project mainly to address the grid instability caused by sudden loss of power from variable renewable sources such as solar and wind. 

“Storing electricity for later use at night time is very expensive and E.P.C. is looking into emerging technologies for this purpose,” said Tuilaepa.

Another concern raised by the Cabinet and Parliamentary Committee was the delay of submissions of the E.P.C. Annual Report 2013-2014.

Tuilaepa explained this was due to the late submission of the Independent Auditor's report on the financial audit of E.P.C .accounts. 

“The Corporation and the Ministry of Finance had worked on the issue of the Afulilo loan interest for more than 20 years and this is the first time it was raised by the External Auditor. 

“The External Auditor needs to understand that this issue pertains to the Government,” said Tuilaepa. 

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