Consumer Unity and Trust Society (CUTS) centre coordinator Chenai Mukumba has challenged the Energy Regulation Board to carry out and publish a December review of wholesale and retail prices of fuel.
In a statement to News Diggers today, Mukumba noted that the ERB had only carried out four fuel price reviews instead of six from the time government announced the removal of fuel subsidies and gave a policy directive to migrate to cost reflective tariffs.
Mukumba stated that the bimonthly system of reviewing fuel prices ensured predictability and certainty in the fuel sub-sector and that it also ensured that consumers were indeed paying cost reflective tariffs.
“In October 2016, in line with the policy decision of 2014 to remove fuel subsidies, and the policy direction to migrate to cost reflective pricing of energy services and products, the Energy Regulation Board (ERB) removed fuel subsidies. Through the ERB, the government would therefore review prices bimonthly and adjust based on performances of the Kwacha against other convertible currencies and international oil prices. The pricing of petroleum products sold in Zambia therefore is mainly affected by movements in oil prices on the international market and the exchange rate of the Kwacha against the US Dollar,” Mukumba stated.
“As CUTS, earlier this year (2017) we encouraged the Energy Regulation Board to implement these changes timeously, particularly when the changes in the market were to the benefit of the consumer. This would serve to minimise the price shocks felt by consumers. However, looking through 2017, the ERB has only carried out four fuel price reviews (January, March, August and October) instead of six. It has now been two months since the last review and there has yet to be an announcement.”
Mukumba stated that the bimonthly system of reviewing fuel prices would ensure that consumers were indeed paying cost reflective tariffs and also that they benefited when market fundamentals are favourable.
“The bimonthly system of review ensures predictability and certainty in the fuel sub-sector. It also ensures that consumers are indeed paying cost reflective tariffs and that consumers benefit when market fundamentals are favourable. As CUTS we would like to urge the ERB to carry out and publish the December review of the wholesale and retail cost of fuel. We reiterate that the government through the ERB should be ardent in communicating the results of the bimonthly review even if there is no change in the price as was done in March this year when the ERB determined that there would be no adjustment in the price of fuel,” stated Mukumba.