By Vanessa Kameza

Economic expert Milward Tobias has backed suggestion by the Electricity Supply Corporation of Malawi (ESCOM) to negotiate with Malawi Energy Regulatory Authority (MERA) so that it is allowed to adjust upwards the electricity tariffs as one of the means of sustaining the company’s operations.

This follows Tuesday’s announcement by ESCOM that it is currently buying electricity from power producers at a price higher than the one it is selling to the end-user consumers a development which has led the utility body to operate at a big loss.

ESCOM Chief Executive Officer, Kamkwamba Kumwenda, has revealed that the institution is spending K140 per kilowatt to buy electricity from the power producers, yet it is selling to end-user consumers at K104 per kilowatt, per month.

But in his remarks, Tobias said in any business one cannot order goods at higher price and expect to survive in the business.

“If what they are paying EGENCO is higher than what they get from the end-users then they are justified,” Tobias said.

He added that much as he agrees that people and companies will fill the pinch from the decision, but what is important is to have uninterrupted supply.

However, Tobias has accused ESCOM management for spending the company’s money on luxuries such as buying expensive vehicles and huge allowances for its top officials.

“I should also add that there are also governance issues in many government parastatals including ESCOM because you can see that many of them that are struggling are squandering money on luxuries instead of prioritising resources to promote the operations of the company.

According to ESCOM, since its unbundling in 2018, it has been operating at a loss, accounting for K112 billion which has gone down the drain since the decision was effected.