NUKU’ALOFA, TONGA (1st November 2019) — Tonga Power Limited hereby notifies all electricity consumers in Tonga that the Electricity Commission has approved the new power tariff of 81.20 seniti per kWh, an increase of 4.1% from 79.90 seniti, effective from 1st November 2019. Despite the increase in the price of diesel, TPL had managed to successfully hold the level of electricity tariff unhanged between 81.20 to 79.90 seniti per kWh between July 2017 and October 2019. 

TPL reduced its Non-Fuel Component of the tariff by $0.0833 per kWh and utilized its declared dividends totaling $5.3 million over the last 2 years to assist with holding the tariff but on the other hand raised huge under-recovery of fuel costs totaling more than $9million.

The fuel tariff review resulted in an integrated new “Kafataha Integrated Model” which identifies the price range, comprising of the ceiling price level and the floor price level, for electricity to help TPL remain solvent in the next financial year.

Fuel prices have been on a steady upward trend since 2017, increasing by $0.6261 (increase of 51%) from $1.2213 per litre (average price 2017) to $1.6454 per litre (average price 2019).

The increase in the power tariff will enable TPL to recover $1.6 million over 12 months. We are expecting the next tariff reset in December 2019 to be effective on 1st January 2020.