The Electricity Supply Corporation of Malawi (Escom) and Electricity Generation Company (Egenco) have engaged the Malawi Energy Regulatory Authority (Mera) as an arbitrator on billing system.
Escom is accusing the power generation company of billing more than what the end user pay, thereby crippling its operations.
Figures we have seen show that, from October 18 to December 22 2021, Egenco billed Escom K245 billion but supplied electricity worth K166 billion.
The figures further indicate that, noting the anomaly, the two key players in the power sector agreed to write off K10 billion in 2019 and K16 billion in 2020.
Mera Consumer Affairs and Public Relations Manager Fitina Khonje said the authority is aware of the issue and was working on resolving the billing issues between them.
Speaking in an interview on Sunday on the sidelines of their meeting with Energy Minister Ibrahim Matola, Escom acting Chief Executive Officer Clement Kanyama said the problem emanates from the unbundling of the two entities.
“We cannot say one party is right or the other is wrong but we are seeking arbitration to assist in resolving this issue and it should be understood from the fact that we now pursue different areas in the provision of electricity to consumers,” he said.
Egenco spokesperson Moses Gwaza said the entity was waiting for outcome of the arbitration.
When Egenco was unbundled from Escom, the two signed power purchase agreements which included the billing system which is under scrutiny.
About five years ago, Escom was stripped off electricity generation functions, which led to its unbundling and formation of Egenco.
The development implied that the generation of power was carved out of Escom following implementation of the Power Market Restructuring programme, meant to increase efficiency in power generation and create an enabling environment for independent power producers to invest in power generation.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.