Announcement from Tonga Power Ltd – Electricity Tariff Adjustment Effective 1st April 2017

LIFE LINE ELECTRICITY TARIFF ADJUSTMENTS EFFECTIVE FROM 1^ST APRIL 2017 English | Tongan

1. Since the last Tariff Adjustment effective 2^nd February 2017 the landed cost of diesel used by Tonga Power Ltd to generate electricity has increased by 8.17 seniti per litre (6.16%) from 132.64 seniti per litre to 140.81 seniti per litre.

2. To cover this increase and also to allow Tonga Power to recover under-recovered fuel cost which currently stand at 2.92 million Pa’anga, the cost of fuel required for electricity generation has risen by 38.67 seniti per unit (kWh) to 41.51 seniti per unit (kWh), an increase of 2.84 seniti. The power tariff therefore increased to 85.86 seniti per unit (kWh).

3. Due to the high power tariff of 85.86 seniti/kWh as a direct result of diesel price movement, The Government of Tonga (Shareholder) approved, the implementation of a Life Line Tariff subsidy. The Government lifeline will assist the most vulnerable consumers, namely all residential consumers who use less than 100 units (kWh) of electricity each month. This will allow all residential consumers a 15.86 cents TARIFF REDUCTION which equates to 18.47% for the first 100 units (kWh) consumed each month effective from 1^st April 2017. This lifeline support is a discount applied on 100% of residential power tariff approved by Cabinet, which will be funded from Tonga Power Ltd Dividend paid to the Shareholder (Tonga Government) in the 2015/16 financial year.

4. The revised tariff rates approved by the Regulator to be effective in respect of all electricity supplied by Tonga Power to electricity consumers on or after 1^st April 2017 are as follows:
   

   RESIDENTIAL CONSUMERS – FIRST 100 KWH
   Per KWH	Current  Tariff	Adjustment	Lifeline Discount	New Tariff
   Non Fuel Component  Fuel Component	44.35 38.67	0 +2.84	0 -15.86	44.35 25.65
   TOTAL	83.02	+2.84	-15.86	70.00
   				-18.47%

   RESIDENTIAL CONSUMERS – IN EXCESS OF 100 KWH NON-RESIDENTIAL CONSUMERS – ALL KWH
   Per KWH	Current  Tariff	Adjustment	Lifeline Discount	New Tariff
   Non Fuel Component  Fuel Component	44.35 38.67	0 +2.84	0 0	44.35 41.51
   TOTAL	83.02	+2.84	0	85.86
   				+3.42 %

5. The Electricity Tariff is regulated by the Electricity Act and administered by the Electricity Commission. The tariff adjustment is determined by a process set down in the Concession Agreement between Tonga Power Limited and the Electricity Commission. The Competent Authority is the Tongan Government Agency whom sets the landed price of diesel which Tonga Power Limited uses for their power generation.Thank you,

   Tonga Power Ltd.

   31^th March 2017