It is good to see the Government doing its bit to ensure that the Electric Power Corporation stays solvent and is still able to make some money as the 20 per cent discount to domestic customers is hurting the state owned enterprise.

The Office of the Regulator this week approved the electricity tariffs for Government ministries with the new power prices to be implemented by the Electric Power Corporation (E.P.C.) and to go into effect retrospectively from 1 July 2023.

The new electricity tariff rates were highlighted in an order issued by the Regulator, Lematua Gisa Fuatai-Purcell in an order paper No. 2023/E89. The order dated 19 September 2023 was made pursuant to section 20 of the Electricity Act 2010 ('Act').

According to the order, the change in tariff is per unit of electricity for Government entities using prepaid meters (Cash power and Smart meters) with the E.P.C. now permitted to charge $1.02 per unit or kWh. For Government entities on induction meters (readable power), the E.P.C. is permitted to charge $1.05 per unit.

This was a step that the Government needed to take. As part of its election promise, the Government reduced electricity tariffs by 20 per cent. This was all good until the EPC started feeling the negative effect of this change.

It was disclosed to this newspaper by the former board that the utility company had been making losses and the discount was one of the main reasons because the electricity generation in Samoa is solely dependent on fossil fuel. The board did advice the Cabinet that the EPC needs to raise the prices but the Government did not budge.

As it is, the Government has been subsidising the fuel costs for running the generators, then the 20 per cent discount meant that operational costs were going to surpass revenue. This in accounting terms means that the EPC has been running on a loss.

This was an unrealistic election promise from the start. Either way, it will hurt the public purse now that the hole will need to be filled by money already allocated elsewhere - it’s a case of robbing Peter to pay Paul.

Instead of going back on its promise, the Government has decided to let domestic users continue benefiting from the discount and to offset the losses, all Government ministries and state owned enterprises will pay more for their power bills.

Even with the discount, Samoa’s electricity rate is one of the highest in the Pacific. According to LivingCost.org, Samoa is the 79th most expensive country in the world. A lot of it has to do with the huge amounts of imports that Samoa relies on.

Before the turn of the millennium, basic needs for a human being’s survival were only food, water and shelter. As we stepped into the new millennium, electricity is now considered to be a basic need. While those born prior to 1980 have memories of living with a benzene light or a kerosene lamp, the modern generation have basically no idea that life can be lived without electricity.

However, with all the modernization around us, electricity is a need. This means that Samoa will have to continue spending large amounts of money to generate electricity even if the power company is at a loss.

There is an urgent need for Samoa to move away from the fossil fuel generators and ensure a move to renewable energy which is not only cheaper but also cleaner. There have been talks and even a few moves made like the hydro generation schemes but it does not seem to be working or taking the pressure off the diesel generators and the fuel bill. Whatever has happened to the solar powered farms? There are still statements coming from the Government about converting to renewable energy but hardly any work is shown to happen. The bigger question is how long until the EPC runs itself into the ground and for how long will the discount last?

Solar power generation is the easiest way towards renewable energy for Samoa however the problem here is that we tend to think big. Solar farms have worked in the Pacific, in the Cook Islands, at least five islands are now powered by solar energy. Samoa is a bigger place, for solar farms to work here, the grids have to be smaller. Perhaps investment into this could be one of the items under the district development fund.

Samoa needs to move at a quicker pace when it comes to renewable energy because there will be a day when the 20 per cent discount is going to be removed. Fuel prices continue to rise, the Government will need a way out and right now, it is renewable energy.