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Tariff Reduction

Tariff Reduction

NUKU’ALOFA, TONGA (26th March 2019) — TPL has been working together with Government to hold its electricity tariff since July 2017. Diesel prices have increased steadily from July 2017 ($1.1784 per litre) to November 2018 ($1.8531 per litre) and only reduces last 3 months to February 2019 ($1.4407 per litre).
TPL in consultation with Government, used its Dividends as well as reduction on its non-fuel component to hold the electricity tariff to date. But since Diesel Prices reduces last 3 months to $1.4407, although still higher than pre-July 2017 diesel prices of $1.1784, TPL’s cost cutting and Dividend utilisation enable it to apply for a slight reduction of $0.0130 per kWh. Total power tariff from 81.20 seniti per kWh to 79.90 seniti per kWh, a 1.6% reduction since the last tariff adjustment in July 2017.

Tonga Power’s collaboration with Government continue to offer thee “life line tariff” subsidy despite the movements in diesel prices. This is the Government of Tonga (Shareholder) continuous response to the high cost of imported diesel which allows all residential consumers who uses less than 100 units of electricity each month to maintain an Electricity Tariff of 70 seniti per kWh or a 9.9 seniti tariff reduction for the first 100 units (kWh) consumed each month effective from 1st March 2019. All other non-residential (business) customers using more than 100 units (kWh) of electricity will pay the new electricity tariff of 79.90 seniti per unit (kWh).

The overall Power Generation from Renewable is only 10% of our total monthly power generation. So the impact of RE on our prices is already included on this calculation. 

The following graph shows how TPL was holding its tariff since July 2017 to February 2019 while the price of diesel fluctuates wildly over the same period.