Joseph Kapika’s scientific contributions

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Publications (2)


Power Sector Reform and Regulation in Africa: Lessons from Kenya, Tanzania, Uganda, Zambia, Namibia and Ghana
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January 2013

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3,579 Reads

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59 Citations

Joseph Kapika

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Figure 9: Local authority surcharge (N¢/kWh)
Figure 10: NamPower financial performance This is in part due to the ECB's commitment to cost reflectivity. More recently, government's N$1Billion recapitalisation programme (N$250 million in 2007 and 2008 respectively with the balance expected in 2009) has significantly aided NamPower's financial health. In addition, government has approved an annual grant of N$120mil-lion to support the running of expensive thermal generation to ensure security of supply over the period 2008 to 2010. Consequently, on account of these and other factors such as Namibia's (the country) own sovereign rating, rating company Fitch in March 2009 reaffirmed NamPower's BBBinvestment-grade rating. Interestingly, in its assessment of NamPower's operating environment the rating agency makes the following comment: 'The regulator continues to make progress towards bringing regulation more into line with developed market standards' (Fitch, 2009). In the distribution sector however, challenges remain. A 2006 benchmarking exercise revealed that all the REDs had failed to perform satisfactorily against set benchmarks, with the best performing having only been satisfactory in three of the specified nine specified performance measures shown in Table 2. In interviews with the Chief Executive Officers of two of the REDs, it was revealed that at current tariff levels there was insufficient revenue being generated to earn an adequate rate of return or to fund the depreciation expense. While no evidence was presented to support this assertion, the ECB's own admission that tariffs were at below cost levels lent it credence. It would however, appear that there was also need for internal efficiency improvements within REDs to lower costs.
Assessing regulatory performance: The case of the Namibian electricity supply industry

November 2010

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236 Reads

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10 Citations

Journal of Energy in Southern Africa

The power sector reforms that commenced in the 1990s led to the establishment of independent electricity regulators in more than twenty countries across Africa. The main purpose for these institutions was to create greater transparency in tariff setting and provide increased certainty for investors. At the same time regulators are charged with the protection of the interests of current and future consumers of electricity. During the initial stages of reform it was the expectation that the state owned incumbents that were traditionally vertically integrated would be unbundled and privatised. In practice there have been very few privatisations and what have emerged are hybrid markets where stateowned utilities remain dominant with independent power producers on the margin. In these markets regulation is a complex melting pot of incentivising the performance of state-owned utilities, attraction of private sector investment especially to fill gaps in generation capacity and making sensitive pricing decisions. Recognising that regulation is beginning to establish a track record, the African Electricity Regulator Peer Review and Learning Network, an initiative of the University of Cape Town, Graduate School of Business provides an opportunity for high level learning through the assessment of regulatory performance. We detail an assessment of regulation in Namibia where we find prices transitioning to cost reflectivity but question the sustainability of current arrangements in the distribution of electricity and the country's long-term generation adequacy.

Citations (2)


... Nations where it is challenging to set cost reflective rates can use the WBWS framework as a guide to allow DISCOs or incumbent utilities (privatized, state-owned, and publicly owned) to price discriminate within their service territories [157,158]. This allows the utility to charge higher costs for customers that are willing to pay more for better electrical service, such as higher reliability or improved power quality [159,160]. This can address problems with state regulated tariffs that do not cover utility costs and provide flexibility to overcome bureaucratic inertia that seeks to maintain established procedures and norms. ...

Reference:

Institutional frameworks to facilitate power sector transformation in West Africa
Assessing regulatory performance: The case of the Namibian electricity supply industry

Journal of Energy in Southern Africa

... The endorsement of the energy policy (power sub-sector reform programme) by the GoU in 2002 made provision for the introduction of diversification in the nation's energy mix [43,[113][114][115][116]. The reform programme aimed at providing a sufficient, consistent, and cost-effective power supply to meet the country's demand, promoting the efficient operation of the power sector and scaling up rural and sub-urban access to maximize the impact on poverty reduction. ...

Power Sector Reform and Regulation in Africa: Lessons from Kenya, Tanzania, Uganda, Zambia, Namibia and Ghana