Lately, most of the enquiries I received through Ethiopian Energy^Power Business Portal, eepBp, are questions related to electricity tariff. I often hear similar concerns every time I visit the electricity sales centers of Ethiopian Electric Utility, EEU, to recharge my own prepaid cards. In fact, the questions, concerns and complains I witnessed are all in line with my prediction that consumers are likely to go energy sensitive as the phased tariff adjustment put in place.

Prior to the adjustment, electricity tariff has been so low that we (consumers) often don’t feel the pressure of altering our own behavior except the fact that we all point our fingers towards the utility for failing to keep the power lines stable. Paying cost reflective tariff and expecting quality and reliable services are in fact mutually inclusive undertakings which we dare to ignore so far. The cheap electricity tariff (we enjoyed) has been the real barrier for the lack of additional investment (particularly the private sector) in the power sector and consumers’ expectation of receiving reliable, accessible and adequate power supply will likely be never unless the tariff is made cost reflective. Of course, affordability is also part of the key equation as it affects investment and all productive interventions. There comes a whole tariff design mechanism which will not be the interest of this article.

It is true that the utility has made tariff adjustments since 2018 that effectively and progressively raises your electricity bills for a consecutive of four years unless you take action to improve your electricity consumption behavior. While there is little you can anticipate complaining to the utility, there is a lot you can do yourself and seek professional advice if you care to keep your electricity bills down. Changing your Behavior towards energy.

In addition to the unit energy price adjustment, the utility has made a clear departure in the energy price (tariff) calculation where your consumption behavior change has so much to influence your monthly electricity bills.  Let me help you understand it as there is a very important distinction from the retired one.

In the domestic/ household tariff category of the retired electricity tariff, you used to pay for an increasing rate of consumption. And now, your energy consumption is directly multiplied with the corresponding block of unit price of energy.  See the example and the table below.

Table 1: Ethiopia Electricity Tariff Information( Retired Vs New)

If your energy meter counts 500 KWHr in the month of January 2017, your energy consumption would have been 

• ETB251=50*0.273+50*0.3564+100*0.4993+100*0.55+100*0.5666+100*0.588

If your energy meter counts 500 KWHr in the month of January 2020 your energy bill will be

• ETB 975.4= 500*1.9508,  clearly you don’t have the lower tariff advantage of the retired tariff system here.

If this is the case, how can you control your bills in the current system? If for some reason, your energy meter counts 501 KWHr, your energy bills will become

• ETB1019.18 = 2.0343*501, multiplied by the next higher tariff category raising your energy cost by ETB 43.78 even if it is just a mere 1KWHr difference.

Using energy efficient appliances and lamps and as simple as switching of repetitive and unnecessary power consuming lights, lamps, appliances and devices can help you control your electricity bills. Keeping most lights off in buildings during the night is one good example. Simple energy conscious mindset or behavioral change is key. Even if it is not that significant, the service charge part is also equally affected. 

1KWHr energy has such a big difference in your electricity bills as it can help you shift to the lower tariff category in the new tariff system being enforced.

In the new (revised) tariff, the utility introduced a completely new system of demand/power charge system for industrial consumers and it would be in your best interest to control the power demand in as much as the same way I explained above. Power factor charge is also the other area that industrial consumers should keep an eye on if you really care to keep your energy bills under control.

The irony is that the behavioral change we all make has a reciprocal and positive effect on the overall energy efficiency in the industry and the effectiveness of the services the utility provides, not just on our electricity bills. This is what we call the virtuous cycle.

Related Reads, 

Electricity/Energy Tariff Adjustment in Ethiopia(Effective as of December 2018 and the adjustment is to be continued to Dec 2021)

Ethiopian Electric Utility, EEU, Incorporates Tariff Adjustments

The Imperative to Ethiopia’s Revision of the Existing Extra Low Electricity Tariff!

Ethiopian Electricity Tariff (Becomes old since December 2018)- The lowest rate in Africa

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