The Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) Rules, 2021
This section is a heading for citation, interpretation, and tariff application and rate review procedures.
AI-assisted research synopsis — verify against the official legal text below.
- Jurisdiction
- Tanzania
- Instrument
- Rule
- Citation
- The Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) Rules, 2021
- Version
- Undated source snapshot
- Language
- en
- Official source
- View official record ↗
WACC apartment building billing application review asset base calculation asset valuation capital expenditure compliance confidentiality consumer protection cost allocation cost approval cost of debt cost of equity depreciation depreciation methodology distribution expenses distribution network expansion electricity electricity pricing electricity sector electricity sub-sector electricity tariffs emergency tariff energy pricing +64 more
Statute overview
About this statute
This section is a heading for citation, interpretation, and tariff application and rate review procedures. This section is a heading list for tariff-setting methodology in the electricity sub-sector. This section is titled “Revenue Requirement” and relates to electricity tariff setting methodology. This section is titled “Natural Gas Tariff Setting Methodology” and refers to Part IV, General Provisions, for a summoning process. This section is a heading for “Authority to supplement procedures” and does not state a substantive rule in the text provided.
Search within this statute
Search all stored provisions in this version.
Legal text
Provisions of The Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) Rules, 2021
Showing 51 of 51
- 3 Verify source ↗
Section 3
AI-assisted research summary: This section is a heading for citation, interpretation, and tariff application and rate review procedures.
3. Citation Application Interpretation PART II TARIFF APPLICATION AND RATE REVIEW PROCEDURES
Part
PART II
- 15 Verify source ↗
Section 15
AI-assisted research summary: This section is a heading list for tariff-setting methodology in the electricity sub-sector.
15. Preparation and Submission of Tariff Application Waiver of requirements Tariff Review at Authority’s Own Motion Confidentiality Emergency Tariff Application Public Inquiry Intervention Evaluation of Tariff Application Evaluation Criteria Decision of the Authority Periodic Tariff Adjustment in the Electricity sub-sector Sub metering by Resellers PART III TARIFF SETTING METHODOLOGY - 4 Verify source ↗
(1) A licensee who wants to impose or review its
AI-assisted research summary: A licensee seeking to set or review an electricity or natural gas tariff must apply to the Authority and follow the prescribed application process.
4.-(1) A licensee who wants to impose or review its electricity or natural gas tariff shall apply to the Authority in the manner prescribed in these Rules and Tariff Application Guidelines made by the Authority. (2) Tariff review applications shall be prepared by licensees in accordance with the tariff application format prescribed in the guidelines prepared by the Authority. (3) The application under sub rule (1) shall be made at least one hundred and fifty days prior to the applicability of the proposed tariff. (4) a licensee shall submit a complete tariff application accompanied with supporting documents and other information in accordance with these Rules. (5) Without prejudice to the provisions of sub rule (4), an application for tariff shall be accompanied by the following:- (a) top sheet which shall comprise of: (i) registered name of the applicant; (ii) full address of the applicant to which communications in the matter will be sent; (iii) full name, title and contact information of the applicant’s chief executive officer or authorized person; (iv) verifiable reference of an applicant’s license 7 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) by EWURA (or a preceding Authority) to provide a regulated service; (v) a succinct statement of the regulatory action being requested; and (vi) signature of the chief executive officer or a duly authorized officer of the applicant; (b) implementation status of conditions contained in the previous order issued to the applicant, if any; (c) business plan which provides in detail the and objectives strategic applicant’s implementation plan; (d) audited financial statements, covering the past three financial years and the most recent interim financial statements prior to the date of the application; (e) statement explaining the proposed adjustment of the current tariff will benefit customers and improve services; how (f) financial implications to the applicant if the requested changes in tariff are not approved. These may include ability of the applicant to pay for its creditors, to meet contractual financial obligations, to service its debt; to cover all the fixed costs; and to spend on capital investment projects; (g) an affirmation that states that all contractual the that may have agreements proposed tariffs have been included in the application; and impact on (h) any other information as may be required by the Authority. (6) Notwithstanding the provisions of sub-rule (5), an applicant shall be required to submit a letter of no objection from the Ministry on the intention to review existing tariff. (7) The application shall be submitted online through LOIS and shall include a workable MS Excel worksheet signed by the Chief Executive or an authorized representative of the applicant in accordance with the format prescribed in the guidelines. (8) When the application is not in compliance with 8 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) the requirements under this rule, the Authority shall refer back or reject the application. (9) An application submitted under this rule may be withdrawn by an applicant through a letter to the Authority at any time before the Authority commences an inquiry process. - 5 Verify source ↗
The Authority may, on application by a licensee or
AI-assisted research summary: The Authority may waive an application requirement under this Part if a licensee applies or on the Authority’s own motion, but only when it considers the waiver to be in the public interest.
5. The Authority may, on application by a licensee or on its own motion, waive any application requirement under this Part, Provided that, no waiver shall be made unless on the grounds of public interest determined as such by the Authority. Waiver of requirements Tariff Review at Authority’s own motion - 6 Verify source ↗
(1) The Authority may, on its own motion, initiate
AI-assisted research summary: The Authority may start a tariff review inquiry on its own motion, and the licensee must provide information the Authority requires.
6.-(1) The Authority may, on its own motion, initiate an inquiry to review a tariff of any licensee where it makes a finding that- (a) there are changes in the circumstances that require tariff adjustment; (b) tariff charged by a licensee was not approved by the authority; (c) the applicable assumptions used to calculate the tariff have significantly changed; and (d) the licensee has failed to submit tariff review application within the prescribed time. (2) The licensee shall be obliged to submit any information required by the Authority when excising its power to review tariff on its own motion under sub – rule (1). - 7 Verify source ↗
(1) A licensee may request the Authority not to
AI-assisted research summary: A licensee may ask the Authority not to share specific information it provided, and the Authority can decide whether the information is confidential and then limit or stop publication.
7.-(1) A licensee may request the Authority not to circulate specific data or information that it has provided to the Authority; Provided that, the Authority shall have powers to determine as to whether the information suffice to be treated as confidential or not. (2) The Authority shall, where it determines that certain information is confidential, limit or prohibit the publication of any information to the public. Confidentiality Emergency Tariff - 8 Verify source ↗
(1) A licensee may submit to the Authority an
AI-assisted research summary: A licensee may apply to the Authority for an emergency tariff application, and the application must include a Top Sheet and a certificate of Urgency from the Minister.
8.-(1) A licensee may submit to the Authority an 9 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Application emergency tariff application to address an emergency situation. (2) The application under sub-rule (1) shall, at minimum contain the Top Sheet and certificate of Urgency from the Minister. (3) Depending on the nature of the application, the Authority may deal with the emergency tariff application without undergoing a full inquiry and evaluation process. Public Inquiry - 9 Verify source ↗
(1) The Authority shall conduct an inquiry before
AI-assisted research summary: The Authority must hold an inquiry before regulating rates or charges, including public notice and comment collection.
9.-(1) The Authority shall conduct an inquiry before exercising power to regulate any rate or charges. (2) The inquiry under sub rule (1) shall involve issuance of a public notice on the application and the solicitation of comments from stakeholders and the general public regarding the reasonableness of the proposed tariff review. (3) Any interested person may submit written comments to the Authority in connection with an application within twenty one (21) days from the date of the notice or seven (7) days after the public hearing meeting. (4) The closure of the Public Inquiry process shall be twenty one (21) days after the date of the public notice or seven (7) days after inquiry meeting, whichever is later. the public (5) The applicant shall submit to the Authority the responses to all raised comments within five (5) working days from the date of closure of the Inquiry process. - 10 Verify source ↗
(1) Any person who wishes to intervene in the
AI-assisted research summary: A person who wants to intervene in a tariff application must notify the Authority in writing within 5 working days and include their name, address, and reasons.
10.-(1) Any person who wishes to intervene in the approval process for a tariff application shall declare his intention to do so in writing within five (5) working days from the date of the public notice. (2) The intention to intervene shall clearly state the name and address of the person seeking intervention and the reasons for that intervention. (3) The Authority shall, after reviewing an application to intervene, either grant or deny such application. (4) The Authority shall, in the event it denies intervention, inform the applicant of such decision in writing, including the reasons thereof. 10 Intervention Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Evaluation of Tariff Application Evaluation Criteria - 11 Verify source ↗
(1) The Authority shall, after receipt of the
AI-assisted research summary: The Authority must evaluate and decide on the application after the public inquiry closes, publish the tariff in the Government Gazette, and the tariff is to be used for three years unless reviewed or extended under sub-rule (3) or other applicable law.
11.-(1) The Authority shall, after receipt of the application under rule 4 and closure of the public inquiry, evaluate and decide on such application pursuant to the Act, sector Tariff Application Guidelines. these Rules and legislation, (2) The tariff set by the Authority under sub-rule (1) shall be published in the Government Gazette and subject to the provisions of sub-rule (3) or other applicable legislation, be in use for a period of three years. (3) Notwithstanding the provision of sub-rule (2), the Authority may:- (a)review the tariff before the period of three years where it discovers that the tariff set is contrary to the provisions of the Act, sector legislation and these Rules; (b) extend the tariff set in sub rule (1) for a further period as the Authority may determine. - 12 Verify source ↗
(1) All Tariff Application filed under these Rules
AI-assisted research summary: The Authority must evaluate tariff applications using the listed criteria, including cost of service, investment incentives, penalties for missed benchmarks, consumer protection, and asset/depreciation rules.
12.-(1) All Tariff Application filed under these Rules shall be evaluated by the Authority on the basis of and in accordance with the following criteria: (a) tariffs shall reflect the average cost of service of each licensee; tariffs shall include:- (b) (i) a mechanism to allow licensee a benefit from efficient investment; and (ii) penalties for failure to achieve benchmarks set by the Authority through yardstick regulations in regard to capacity utilization, operation and maintenance and unaccounted regulated services; (c) investment tariffs shall be determined in a manner which promotes continued reasonable in equipment, facilities and research and development for qualitative and quantitative improvement in the provision of regulated activities; tariffs shall be determined in a manner that protects consumers against monopolistic and oligopolistic pricing; tariffs shall generally be determined taking into account a reasonable rate of return, prudent operation and maintenance costs, depreciation, (d) (e) 11 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) government levies and if applicable financial services and cost of regulated services; (f) while determining the value of a licensee's fixed assets in operation, the value of assets funded wholly or partially, on a nonrefundable basis by a person other than a licensee shall be excluded to the extent of such contribution; (g) only such capital expenditure shall be included in the rate base as is prudent, cost effective and economically efficient; and (h) depreciation of a licensee's assets shall be allowed on the basis of their useful life as may be determined from time to time by the Authority. (2) The Authority shall strike a balance, to the extent possible, in order to optimize the benefits to all persons likely to be affected by the Authority's determination of tariffs when evaluating the tariff application. - 13 Verify source ↗
(1) The Authority shall, after due consideration of
AI-assisted research summary: The Authority must issue a Tariff Order setting approved tariffs and charges, and licensees must not charge customers more than the approved tariff.
13.-(1) The Authority shall, after due consideration of all material facts to the application, issue a Tariff Order prescribing the approved tariff and charges to be applied by the applicant in providing regulated services. (2) No licensee shall charge any customer a tariff exceeding that approved by the Authority pursuant to these Rules and published in the Government Gazette. - 14 Verify source ↗
(1) The Authority shall, upon application by a
AI-assisted research summary: The Authority must review, adjust, and publish tariffs on set schedules, and it may also adjust tariffs on its own motion.
14.-(1) The Authority shall, upon application by a licensee: (a) on quarterly basis, review and adjust the tariffs for costs associated with fuel and exchange rate fluctuation; (b) on half yearly basis adjust the tariffs for costs associated with inflation; (c) on annual basis, review and adjust the tariffs based on performance of the planned projects; and (d) adjust the tariff accordingly, whenever the licensee receives a tax exemption, grant or a subsidy from the Government. (2) Tariff adjustments for costs associated with fuel, exchange rate fluctuations and inflation shall be done in 12 Decision of the Authority Periodic Tariff Adjustment in the Electricity sub-sector Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Sub- metering by resellers accordance with the formula provided for in the First Schedule. (3) Notwithstanding the generality of sub-rule (1), the Authority may, on its own motion, effect periodic tariff adjustment. (4) The Authority shall, on quarterly, half yearly and annual basis, as the case may be, publish the adjusted tariffs under sub-rule (1), in newspapers of wide circulation. - 1 Verify source ↗
Transmission tariff shall be determined using a postage stamp
AI-assisted research summary: Transmission tariff must be determined using a postage stamp methodology.
1. Transmission tariff shall be determined using a postage stamp methodology. - 2 Verify source ↗
The Revenue Requirement of the Transmission System Operator
AI-assisted research summary: This section sets the formula for calculating the Transmission System Operator’s revenue requirement.
2. The Revenue Requirement of the Transmission System Operator shall be determined using the following methodology: RR = (RAB*WACC) + D + O&M - R whereas: RR means the Revenue Requirement; RAB means the average Transmission Regulatory Asset Base which shall be determined as per paragraph 1 of the First Schedule; WACC means Weighted Average Cost of Capital which shall be determined as per paragraph 2 of the First Schedule; D means the regulatory depreciation which shall be in determined using accordance to paragraph 3 of the First Schedule; line method the straight O&M means the operation and maintenance costs which shall be prudently incurred for the provision of service by the Transmission System Operator in accordance with the technical standards used in Tanzania and applicable legal regulations; R means other revenues related to the regulated activity including the net amount (revenues - expenditures) realised through the cross-border trade. Determination of Transmission Tariff - 3 Verify source ↗
Section 3
AI-assisted research summary: The transmission tariff must include amounts paid by Producers, Distribution Network Operators, and eligible customers, and it must be calculated using the stated formula.
3. The transmission tariff shall comprise the transmission tariff paid by Producers, Distribution Network Operator and eligible customers and shall be determined in accordance with the following formula; whereas: Ttso means the Average Transmission Tariff; Rgtso means Revenue Requirement in respect of transmission service rendered to generators which shall consist of energy and capital related components; Rdtso means Revenue Requirement in respect of transmission services rendered to Distribution Network Operators which shall consist of energy and capital related components; Retso means Revenue Requirement in respect of transmission services rendered to eligible customers which shall consist of the energy and capital related components; and kWh means annual units transmitted through the transmission line. 21 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) PART III SYSTEM OPERATOR RATE SETTING METHODOLOGY System Operation Pricing
Part
PART III
- 16 Verify source ↗
Section 16
AI-assisted research summary: This section is titled “Revenue Requirement” and relates to electricity tariff setting methodology.
16. Revenue Requirement 1 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Electricity Tariff Setting Methodology - 18 Verify source ↗
Natural Gas Tariff Setting Methodology
AI-assisted research summary: This section is titled “Natural Gas Tariff Setting Methodology” and refers to Part IV, General Provisions, for a summoning process.
18. Natural Gas Tariff Setting Methodology PART IV GENERAL PROVISIONS Summoning process - 16 Verify source ↗
(1) The Authority shall use a Revenue Requirement
AI-assisted research summary: The Authority must use a Revenue Requirement Methodology when setting tariffs for regulated sectors.
16.-(1) The Authority shall use a Revenue Requirement Methodology in determining tariff for regulated sectors. 13 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) (2) The Revenue Requirement Methodology shall be framed on the principles that revenues of the regulated utilities have to cover operating and maintenance expenses, depreciation, taxes and shall ensure a fair return on assets employed in rendering regulated services. The revenue requirement shall be determined by the following formula: for the and means Revenue Requirement Where: RR regulatory year; O&M means Operation expenses; D T WACC means Weighted Average Cost of Capital; and RAB means assets of the licensee which are used and useful in the provision of regulated service to the customers. means Depreciation charge; means Corporate Taxes; maintenance (3) For the purpose of sub rule (2): just and reasonable (a) operating and maintenance expenses shall include incurred all expenditure wholly and exclusively for the provision of regulated activity and shall meet the following qualification criteria: (i) expenses must be incurred in an arm’s length transactions; expenses must be incurred in the normal operation of including a reasonable level of refurbishment, repairs and maintenance costs; licensee the (ii) (iii) expenses must be prudently incurred after careful consideration of available options and such consideration would entail a competitive bidding and transparency in the procurement process; (b) regulatory Asset Base shall be determined as per the First Schedule and shall include all used and useful assets in the provision of regulated activity and shall be considered in the determination of 14 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) annual depreciation charge, irrespective of sources of financing; (c) the Regulatory Asset Base shall cover all assets employed by the applicant in the provision of regulated activities. The said assets shall be prudently designed, competitively procured and or constructed; (d) the Return on Regulatory Asset Base for the applicant shall be calculated using the Weighted Average Cost of Capital (WACC) which shall be determined according to the First Schedule; (e) the depreciation charge of the allowed revenue requirement shall be computed on the Historical cost of the Regulatory Asset Base using a straight line method over the useful economic life of the asset or project according to the First Schedule; (f) subject to the requirements of the Income Tax Act, any taxes including corporate taxes paid or to be paid by the licenses may be considered in the determination of revenue requirement provided that exempted taxes in the provision of regulated services shall not be included in the determination of revenue requirement. (4) Notwithstanding the generality of sub rule (2) and (3), the Authority may specify provisions that are specific to the natural gas sub-sector or different segments of the electricity sub-sector for determination of the revenue requirement. Electricity Tariff Setting Methodology - 17 Verify source ↗
Methodologies for determination of the electricity
AI-assisted research summary: Tariff methodologies for electricity system operation, market generation, operation, distribution, and supply are to be set out in the Second Schedule.
17. Methodologies for determination of the electricity system operation, market generation, operation, distribution and supply tariffs shall be as prescribed in the Second Schedule. transmission, Natural Gas Tariff Setting Methodology GN No.353 of 2020 - 18 Verify source ↗
Methodologies for determination of tariff for natural
AI-assisted research summary: Tariff setting for natural gas regulated activities must follow the Petroleum (Natural Gas Pricing) Regulations, 2020, or any replacement rules.
18. Methodologies for determination of tariff for natural gas regulated activities shall be in accordance with the Petroleum (Natural Gas Pricing) Regulations, 2020 or any other replacement thereof. PART IV GENERAL PROVISIONS 15 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Summoning process - 1 Verify source ↗
System Operation fee shall be charged to customers that are
AI-assisted research summary: System operation fee is charged to customers connected to 400 kV, 220 kV, 132 kV, or 66 kV voltage levels.
1. System Operation fee shall be charged to customers that are connected to the voltage levels of 400 kV, 220 kV, 132 kV and 66 kV and shall include the following elements: (a) (b) (c) active electric energy injected in the transmission network by generators connected to the transmission network; take-off of active electric energy; and ancillary services including excessive take-off of reactive electric energy. Determination of Revenue Requirement - 2 Verify source ↗
The Revenue Requirement of the System Operator shall be
AI-assisted research summary: This section sets the formula for determining the System Operator’s revenue requirement.
2. The Revenue Requirement of the System Operator shall be determined using the following methodology: RRSO = O&M + D - R where, RRSO means total Revenue Requirement to be generated from customers (Rcso) and generators (Rgso); D means the regulatory depreciation which shall be determined by the straight line method in accordance to paragraph 3 of the First Schedule; O&M means the operation and maintenance costs which shall be prudently incurred for the provision of service by the System Operator in accordance with the technical standards used in Tanzania and applicable legal regulations; R means other revenues related to the regulated activity including the net amount (revenues - expenditures) realised through the cross-border trade. Determination of System Operator's Fee - 3 Verify source ↗
The System Operator's fee shall be paid by generators, Transmission
AI-assisted research summary: Generators, transmission system operators, distribution network operators, and eligible customers must pay the System Operator’s fee.
3. The System Operator's fee shall be paid by generators, Transmission System Operators, Distribution Network Operators and eligible customers, and shall be determined in accordance with the following methodology: Where, Tso means the Average System Operator's Fee; Rgso means Revenue Requirement the System Operator’s services rendered to generators which shall consist of energy and capital related components; in respect of Rtso means Revenue Requirement in respect of System Operator’s services rendered to the Transmission System Operator which shall consist of energy and capital related components; Rdso means Revenue Requirement in respect of System Operator’s services rendered to Distribution System Operators which shall consist of energy and capital related components; Reiso means Revenue Requirement in respect of System Operator’s services rendered to eligible customers which shall consist of energy and capital related components; and kWh means annual active electric energy taken over by customers. 22 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) PART IV MARKET OPERATOR RATE SETTING METHODOLOGY Transmission Pricing
Part
PART IV
- 24 Verify source ↗
Authority to supplement procedures
AI-assisted research summary: This section is a heading for “Authority to supplement procedures” and does not state a substantive rule in the text provided.
24. Authority to supplement procedures __________ SCHEDULES __________ 2 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) THE ENERGY AND WATER UTILITIES REGULATORY AUTHORITY ACT (CAP. 414) _______ RULES _______ (Made under section 40(1)(g)) _______ THE ENERGY AND WATER UTILITIES REGULATORY AUTHORITY (ELECTRICITY AND NATURAL GAS) (TARIFF APPLICATION AND RATE SETTING) RULES, 2021 PART I PRELIMINARY PROVISIONS Citation - 19 Verify source ↗
(1) The Authority may summon any person it
AI-assisted research summary: The Authority may summon a person to provide information, documents, or evidence, and failure to comply without lawful excuse is an offence.
19.-(1) The Authority may summon any person it believes to be capable of supplying information necessary to assist it in fulfilling its obligations. (2) A summon made under sub-rule (1) may require a person to: furnish information in writing; (a) (b) produce any document to the Authority; or (c) appear before evidence. the Authority to give (3) Any person who without lawful excuse refuses or fails to comply with a summons to provide information commits an offence and shall, on conviction, be liable to a fine not exceeding three hundred thousand shillings or imprisonment for a term not exceeding fifteen months or to both. Offences - 20 Verify source ↗
Any person who
AI-assisted research summary: Any person who sells or offers regulated services using an unapproved or excessive tariff, creates an artificial shortage, acts without Authority authorization, or ignores Tariff Order conditions is treated as contravening an Authority order and may be fined or imprisoned.
20. Any person who: (a) offers for sale or sells regulated services using a tariff that is not approved in accordance with these Rules; (b) offers for sale or sells regulated services at a tariff that exceeds the approved tariff; (c) either individually or jointly with another person creates an artificial shortage of the regulated services; (d) refuses or fails to conduct its licensed activity in the absence of an authorization to do so by the Authority; or (e) fails to implement conditions stated in the Tariff Order, shall be deemed to have contravened an order of the Authority and shall on conviction- (a) in the case of an offence related to the electricity sub-sector, be liable to a fine of not less than three million shillings; and (b) in the case of an offence related to the natural gas sub sector, be liable to a fine of not less than ten million shillings or to imprisonment for a term of not less than two years or both. 16 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Appeals Cap.285 General penalty Revocation of GN. No. 452/2017 - 21 Verify source ↗
Any person who is aggrieved by the decision of the
AI-assisted research summary: An aggrieved person may appeal a decision of the Authority to the Tribunal.
21. Any person who is aggrieved by the decision of the Authority made under these Rules may appeal to the Tribunal pursuant the Fair Competition Act. the provisions of to - 22 Verify source ↗
Any person who breaches any provisions of these
AI-assisted research summary: If a person breaches these Rules and no specific penalty is provided, the person is liable to a fine of up to 500,000 shillings.
22. Any person who breaches any provisions of these Rules for which no specific penalty is prescribed shall be liable to a fine not exceeding five hundred thousand shillings. - 23 Verify source ↗
(1) The Energy and Water Utilities Regulatory
AI-assisted research summary: The 2017 tariff application and rate setting rules are revoked, but existing orders, exemptions, and directives made under them continue in force until they are revoked, expire, or otherwise stop having effect.
23.-(1) The Energy and Water Utilities Regulatory Authority (Tariff Application and Rate Setting) Rules, 2017 are hereby revoked. (2) Notwithstanding the revocation of the Energy and Water Utilities Regulatory Authority (Tariff Application and Rate Setting) Rules, 2017, all orders, exemptions or directives made or issued or deemed to have been made or issued under those rules shall be deemed to have been made under these Rules, and shall remain in force until revoked or otherwise expire or cease to have effect. Authority to supplement procedures - 24 Verify source ↗
The Authority may, in the event procedures are not
AI-assisted research summary: If these Rules do not provide a procedure, the Authority may take necessary and permitted action to effectively decide matters before it.
24. The Authority may, in the event procedures are not provided for under these Rules, do whatever is necessary and permitted by the Act, the EWURA Act and relevant laws to enable it to effectively and completely adjudicate on any matter before it. 17 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) __________ FIRST SCHEDULE __________ (Made under Rule 14(2) and 16(3)) __________ GENERAL METHODOLOGY FOR DETERMINATION OF SOME COMPONENTS OF REVENUE REQUIREMENT Regulatory Asset Base - 1 Verify source ↗
Section 1
AI-assisted research summary: The provision sets out how the Regulatory Asset Base (RAB) is calculated and defines the terms used in that calculation.
1. following methodology: (1) The Regulatory Asset Base (RAB) shall be determined using the whereas: RABt means Regulatory Asset Base at the end of year t (current year) RABt-1 means Regulatory Asset Base at the end of year t-1 (2) The Regulatory Asset Base at the end of year t shall be determined by the following formula: whereas: RABt = RABt-1 + CAPEXt – St – Dt + ΔWCt means Regulatory Asset Base on year t (current year) RABt RABt-1 means Regulatory Asset Base in year t-1 CAPEXt means capital additions during year t, means asset disposals during year t St Dt means depreciation in the reporting year, and ΔWCt year. means change in the working capital in the reporting (3) RAB shall consist of all assets that are “used and useful” in provision of regulated services. Weighted Average Cost of Capital - 2 Verify source ↗
Section 2
AI-assisted research summary: This section sets the formula and definitions for calculating WACC after tax for the Regulatory Asset Base, and lets the applicant suggest a comparable foreign cost of equity if Tanzanian market parameters are not readily available.
2. (1) The Weighted Average Cost of Capital (WACC) after tax, applicable to the Regulatory Asset Base (RAB) shall be determined using the formula: whereas: WACC” means the rate of return, expressed as percentage, required by the providers of capital (both debt and equity) which is approved by the Authority; “E” means the market value of equity expressed in TZS; “D” means the market value of debt expressed in TZS; "E+D" market value of the Regulated Licensee expressed in TZS; “Ke” means the cost of equity expressed as a percentage as 18 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) determined in accordance with sub- paragraph (2); “Kd” means the weighted average cost of debt expressed as percentage; and “Tc” means applicable statutory corporate tax rate expressed in percentage. (2) The cost of equity shall be calculated using the Capital Asset Pricing Model (CAPM) as given hereunder: whereas: Ke means the cost of equity; Rf means the risk free rate of return; βe means the equity beta as determined in sub-paragraph (3); and [Rm-Rf] means the return over the risk free rate that investors would expect in order to invest in a well-diversified portfolio of equities (otherwise referred to as the equity or market risk premium). (3) The equity beta shall be determined using the following formula: whereas: βe means the equity beta; βa means the asset beta; and D/E means the debt to equity ratio. (4) The cost of debt capital shall be calculated by the following formula: whereas: Rd means the cost of debt; Rf means the risk free rate of return; and DRP means the debt premium, that is, the increment above the risk free rate that reflect the additional risk of borrowing compared with Government bonds. (5) In the event that some parameters in the computation of the cost of equity are not readily available in the Tanzanian market, the applicant may suggest the cost of equity applicable to utilities in other countries with similar conditions as that of Tanzania. Regulatory Depreciation - 3 Verify source ↗
Section 3
AI-assisted research summary: This provision gives a straight-line formula for regulatory depreciation of each asset for a regulatory year and defines the variables used.
3. shall be determined using a straight line method using the following formula- Regulatory depreciation of each asset for any Regulatory Year ‘t’, whereas: Dt means the annual regulatory depreciation for the Regulatory Year ‘t’; 19 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) RAB means Regulatory Asset Base of each asset as determined in paragraph 1 of this Schedule; and N means capital redemption period expressed as a number of regulatory years based on the remaining useful economic life of each regulatory asset. _______ SECOND SCHEDULE _______ (Made under Rule 17) ________ PART I GENERATION RATE SETTING METHODOLOGY Generation Service Charge Weighted Average Cost of Generation - 1 Verify source ↗
Market Operation Tariff shall be charged in respect of market
AI-assisted research summary: A Market Operation Tariff is to be charged for market operation services provided to customers connected at 400 kV, 220 kV, 132 kV, and 66 kV.
1. Market Operation Tariff shall be charged in respect of market operation services offered to customers connected to voltage levels of 400 kV, 220 kV, 132 kV and 66 kV. Determination of Revenue Requirement - 2 Verify source ↗
Section 2
AI-assisted research summary: The Revenue Requirement of the System Operator is calculated using RRIMO = O&M + D - R.
2. The Revenue Requirement of the System Operator shall be determined using the following methodology: RRIMO = O&M + D - R where, RRIMO means the Revenue Requirement; D means the regulatory depreciation which shall be determined by the straight line method; O&M means the operation and maintenance costs which shall be prudently incurred for the provision of market services by the Market Operator; and R means other revenues related to the regulated activity including the net amount (revenues - expenditures) realised through the cross-border trade. Determination of Market Operator's Fee - 3 Verify source ↗
The Market Operator's fee shall be charged
AI-assisted research summary: The Market Operator’s fee is charged to generators, transmission system operators, distribution network operators, and eligible customers, and is calculated using the stated methodology.
3. The Market Operator's fee shall be charged to generators, Transmission System Operators, Distribution Network Operator and eligible customers, and shall be determined in accordance with the following methodology: where, Tmo means the Average Market Operator's Tariff; Rgmo means Revenue Requirement in respect of Market Operator’s services rendered to generators which shall consist of energy and capital related components; Rtmo means Revenue Requirement in respect of Market Operator’s services rendered to Transmission System Operators which shall consist of energy and capital related components; Rdmo means Revenue Requirement in respect of Market Operator’s services rendered to Distribution Network Operators which shall consist of energy and capital related components; Remo means Revenue Requirement in respect of Market Operator’s services rendered to eligible customers which shall consist of energy and capital related components; and kWh means annual active electric energy taken over by customers. PART V DISTRIBUTION AND SUPPLY TARIFF SETTING METHODOLOGY Distribution and Supply Cost
Part
PART I
- 1 Verify source ↗
These Rules may be cited as the Energy and
AI-assisted research summary: These Rules may be cited by the stated title.
1. These Rules may be cited as the Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) Tariff Application and Rate Setting) Rules, 2021. Application - 2 Verify source ↗
These Rules shall apply to tariff applications
AI-assisted research summary: These Rules apply to tariff applications and rate setting in the electricity and natural gas sub-sectors in Mainland Tanzania.
2. These Rules shall apply to tariff applications and rate setting under electricity and natural gas sub- sectors in Mainland Tanzania. Interpretation - 3 Verify source ↗
In these Rules, unless the context otherwise
AI-assisted research summary: This section defines key terms used in the tariff application and rate-setting rules.
3. In these Rules, unless the context otherwise Cap. 414 requires: “Act” means the Energy and Water Utilities Regulatory Authority Act; “applicable law, law” means any principal treaty, convention, proclamation, regulation, rule, order or by-law that is customarily treated in Tanzania as having legally binding force and which is relevant to matters pertaining the electricity and natural gas sub sectors; regulation tariff to in “applicant” means a regulated supplier in the electricity or natural gas sub sectors; “Authority” means the Energy and Water Utilities Regulatory Authority; “automatic electricity tariff adjustment” means a tariff adjustment by the regulated electricity utility based on changes in non-controllable costs – that is, costs 3 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) that are beyond the control of the Utility (such as the costs resulting from foreign currency exchange rates, inflation and fuel costs) - which must be passed through to the customer tariff; “capital cost” means actual costs prudently incurred by a licensee in connection with planning, development, financing, designing, engineering, procurement, completion, supply, commissioning, testing, insurance and ownership of licensed facility that is used and useful in relation to the provision of regulated service; construction, installation, “capacity-weighted distance model” means setting the allowed revenue and creating a segmented network representation; "Capital Work in Progress (CWIP)" means accumulated capital costs of an asset under construction or installation which shall be capitalized or transferred to Plant in Service after commercial operation date; "cost reflective tariff" means a tariff which is based on all conceivable costs necessary to install, operate and maintain the assets and provide reasonable return to the licensee for rendering regulated services; “capital expenditure” means the actual costs prudently incurred by a utility in procuring and restoring assets and investment costs such as planning, development, financing, design, engineering, procurement, supply, testing, construction, commissioning and insurance; completion, installation, “customer” means a person who purchases or receives regulated services for own use or sale; “customer class” means a category of persons who purchase or receive regulated services and are specified according to the use or sale; "emergency tariff application" means an application submitted by the applicant with a certificate of urgency from the responsible Minister; “formal presentation” means a written presentation by an interested party who has registered for a public hearing; “interested party” means a person with an interest in or who is affected by the subject matter of a public 4 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) hearing; "grant" means financial support from the government or donor agency to a licensee to meet operational or capital expenditure; “letter of no objection” means any permit or approval granted by the sector ministry to any regulated public utility signifying the ministry’s consent to the tariff application submitted to EWURA; "licensee" means a holder of a licence to conduct regulated activity and shall include any entity that is exempted from obtaining a licence pursuant to the provisions of the applicable law; “LOIS” means an online electronic system maintained by the Authority for submitting and processing of licenses, consumer applications complaints; tariff and “Ministry” means the Ministry responsible for electricity and natural gas matters; “operating expenditure” means a category of expenditure that a business incurs as a result of performing its normal business operations; “postage stamp” means a fixed charge per unit of energy transmitted within a particular zone, regardless of the distance that the energy travels; “Rate of Return” or “WACC” means the nominal rate of return per annum as determined by using nominal post-tax weighted average cost of capital; “rate setting methodology” means a methodology approved by the Authority that a licensee uses to determine a tariff; “reasonable return” means the level of return that a licensee would seek for enterprises of similar risk; “regulated activity” means: (a) electricity generation, system operation, market operation and distribution services; and transmission, (b) natural gas processing, transmission, distribution and compression services; “reference utility” means an ideal or hypothetical efficient utility that is used to benchmark a licensee for estimation of operational costs of providing regulated 5 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) services under the same conditions; include Capital Costs, “Regulatory Asset Base” or “RAB” means the total cost to be depreciated over the economic life of the asset and lenders fees and shall commissions, interest during construction, the initial debt service reserve account value, development costs and any withholding tax applied and grossed up on interest paid to the lenders prior to the COD; “regulatory year” means each period of three hundred and sixty-five days (or three hundred and sixty-six days in a “leap year”) commencing on the Expansion Project COD and thereafter on each anniversary of such date until the end of the Term; “reseller” means the owner of an apartment building, residential or commercial complex who is supplied with regulated services by a licensee and sell the services to the occupants of the reseller’s premises; “revenue requirement” means the total amount of money a utility must collect from customers to pay all costs which include operating and maintenance expenses, depreciation, government levies and a reasonable return on investment so as to properly operate and maintain its system and meet its financial obligations and shall be determined from time to time in accordance with rule 16; taxes, “sub metering” means the installation of equipment to determine the actual usage of the regulated service for each residential unit in an apartment building, residential or commercial unit; "subsidy" means financial support from the government or donor agency to meet all or part of operating expenses or capital expenditure; “tariff” means any charge, fee, price or rate charged for the provision of a regulated activity as shall be approved by the Authority; “tariff period” means a period, in a designated number of years, for which the approved tariffs shall apply; “tariff schedule” means the detailed set of rates and charges to be applied by a Licensee to its customers for the provision of regulated activities; “Tariff Application Guidelines” means the guidelines 6 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) issued by the Authority to regulate the procedure on applying for a tariff in the electricity and natural gas sub-sectors; "test year" means a period of measurement for a recent, consecutive twelve-month period consisting of a full year of operations where data is readily available; “Tariff Application Top Sheet or “Top Sheet” means the cover sheet of the application containing information prescribed under rule 5; Cap. 285 “Tribunal” means established under Competition Act; and the Fair Competition Tribunal the Fair the provisions of “WACC” means the Weighted Average Cost of Capital. PART II TARIFF APPLICATION AND RATE REVIEW PROCEDURES Preparation and submission of tariff application - 1 Verify source ↗
Generation Service Charge (GSC) shall include the Weighted Average
AI-assisted research summary: The Generation Service Charge (GSC) must include the Weighted Average Cost of Generation and Power Purchases.
1. Generation Service Charge (GSC) shall include the Weighted Average Cost of Generation and Power Purchases as determined under paragraph 2. - 2 Verify source ↗
(1) The Weighted Average Cost of Generation (WACG) shall be
AI-assisted research summary: This provision defines the variables used to calculate the Weighted Average Cost of Generation (WACG) and explains what fixed costs include.
2.-(1) The Weighted Average Cost of Generation (WACG) shall be determined as follows: whereas: Xi means forecast total units planned to be generated by generator i in year t and expressed in MWh; Gi means benchmark generation costs of generator i and shall include all known variable costs; FCt means benchmark fixed costs (capacity costs) expressed in TZS/MW as determined in paragraph (3); and ICt means installed capacity of used and useful plants in year t expressed in MW. (2) Fixed costs for generation shall include the cost of investment annuity (the fixed assets multiplied by the weighted average cost of capital plus depreciation) and the fixed operation and maintenance costs as follows: whereas: FA means Fixed Assets; WACC means the Weighted Average Cost of Capital as determined in paragraph 2 of the First Schedule; and DP means the Regulatory Depreciation calculated using the Straight Line Depreciation Method as per paragraph 3 of the First Schedule. 20 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) PART II TRANSMISSION SYSTEM OPERATOR RATE SETTING METHODOLOGY Transmission Pricing Determination of Revenue Requirement
Part
Schedule.
- 15 Verify source ↗
(1) Any person who owns an apartment building,
AI-assisted research summary: Owners of apartment buildings may install sub-metering, and if they do, they must allocate main-meter electricity or gas costs to tenants based on each unit’s consumption.
15.-(1) Any person who owns an apartment building, receives residential or commercial complex and electricity or natural gas from a licensee may provide for sub-metering of each dwelling house or rental unit for the measurement of quantity of electricity or natural gas consumed by the occupant of the unit. (2) A person who has provided for sub metering under sub rule (1) shall aggregate the total electricity or natural gas cost of the main meter which are energy, demand, services and government taxes and levies including technical losses up to 5% in the building and apportion the amount thereof to each tenant according to the total unit consumed by each tenant. (3) Notwithstanding the provision of sub-rule (1) in the absence of sub-meters, energy and other charges to the tenants shall be distributed proportionally based on the agreed criteria provided that the cost to be incurred by the tenants shall not exceed the bill paid by the owner of the premises to the utility. PART III TARIFF SETTING METHODOLOGY Revenue Requirement
Part
PART V
- 1 Verify source ↗
(1) Distribution and Supply cost shall be determined using the following
AI-assisted research summary: The provision sets a formula for calculating Distribution and Supply cost, and says the Authority must approve the costs in that formula only if they are efficient, technically compliant, and sufficient to meet demand and supply quality.
1.-(1) Distribution and Supply cost shall be determined using the following formula: 23 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) D&S = O&M + (WACC*RAB) + D + NL+DN whereas: "D&S" means the Distribution and Supply cost expressed in TZS; “O&M” means Operation and maintenance Costs; "WACC” means the rate of return, expressed as percentage, as determined in paragraph 2 of the First Schedule; "RAB" means the Regulatory Asset Base (RAB) determined based on historical costs applying the formula stipulated in paragraph 1 of the First Schedule; “D” means the Depreciation as determined in paragraph 3 of the First Schedule; "NL" means Capital and O&M expenditure required to reduce Network Losses; “DN” means Capital expenditure required for expansion of the distribution network. (2) The costs in sub-paragraph (1) shall be approved by the Authority based on efficiency in the sense of cost and technically compliant, sufficient to meet demand and quality to meet supply. - 2 Verify source ↗
Operation and Maintenance Expenses shall be determined by using the
AI-assisted research summary: Operation and Maintenance Expenses must be determined using the Reference Utility Model or projections based on historical costs, whichever is lower.
2. Operation and Maintenance Expenses shall be determined by using the Reference Utility Model or projections based on historical costs, whichever is lower. - 3 Verify source ↗
Asset acquired through Government or consumer contribution or funds
AI-assisted research summary: Assets acquired through government or consumer contributions, or funds allowed in tariffs for expanding the distribution network, count in depreciation calculations but not in rate-of-return calculations.
3. Asset acquired through Government or consumer contribution or funds allowed in tariff for the expansion of the distribution network shall be considered in the calculation of depreciation but shall be excluded from the calculation of Rate of Return. Operation and Maintenance Expenses Capital Contribution Network Losses - 4 Verify source ↗
Cost associated with Network Losses may be considered in the
AI-assisted research summary: The Authority must determine the relevant costs every year, and those costs may be considered when setting distribution expenses.
4. Cost associated with Network Losses may be considered in the determination of distribution expenses. The Authority shall determine such costs on an annual basis. Distribution Network Expansion - 5 Verify source ↗
Funds for expansion of the distribution network may be considered by
AI-assisted research summary: The Authority may consider funds for expanding the distribution network if certain financing shortfalls are proven.
5. Funds for expansion of the distribution network may be considered by the Authority if it is proven that the Rural Energy Agency (REA) cannot finance such projects, the utility cannot source financing from financial institutions or the available funds from an approved tariff will not be sufficient to finance the approved expansion plan. PART VI AUTOMATIC ADJUSTMENT AND PASS THROUGH COSTS Fuel Cost Charge
Part
PART VI
- 1 Verify source ↗
All electrical energy units purchased by electricity customers shall be
AI-assisted research summary: Electricity customers are liable for a Fuel Cost Charge on purchased electrical energy units, calculated using the stated formula.
1. All electrical energy units purchased by electricity customers shall be liable to a Fuel Cost Charge which shall be calculated in accordance with the following formula: Fuel Cost Charge in TZS/kWh calculated to the nearest Shilling: Where: 24 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Ci means actual price in TZS/litre or TZS/mmBTU paid by the Utility or Electric Power Producers for fuel consumed by Plant i, where i= 1, 2, … n, during the quarter preceding the first month of the following quarter at all existing thermal plants on the Interconnected System and the Off- Grid System, as the case may be. This shall also include other thermal power plants to be constructed and in respect of which the distribution or supply licensee shall enter into Power Purchase Agreements with Electric Power Producers for the supply of electricity; Gi means all units generated and or purchased by the utility from Electric Power Producers’ Plant i, where i= 1, 2, …, n, during the quarter preceding the first month of the following quarter at each existing thermal plant on the Interconnected System and the Off-Grid System, and imports or exports from Uganda Electricity Transmission Company Limited, Zambia Electric Company, Kenya Power Lighting Company adjusted for system losses as the case may be. This shall also include other thermal power plant(s) to be constructed and in respect of which the distribution or supply licensee shall enter into Power Purchase Agreement(s) with Electric Power Producer(s) for the supply of electricity; Si means Specific fuel consumption in litre/kWh or mmBTU/kWh for any thermal plants; Pi means sum of fuel displacement costs and other pass through charges based on power purchased from Power Plant i, where i =1, 2 ... n., Emergency Power Plants and other power plants to be constructed in respect of which a generation licensee shall enter into a Power Purchase Agreement with Electric Power Producers for the supply of electricity to a distribution or supply licensee; All fuel displacement and pass through costs shall be converted to Tanzania Shillings using the actual mean exchange rate obtained by the licensee as reported by the Bank of Tanzania in the quarter preceding the first month of the following quarter; G means total of all units generated by the utility, purchased by the utility from Electric Power Producer(s), and net imports during the quarter preceding the first month of the following quarter, including Off-Grid power stations and imports; and L means the target System loss factor in transmission and distribution system. Foreign Exchange Rate Fluctuation Adjustment - 2 Verify source ↗
All electrical energy units purchased by electricity customers shall be
AI-assisted research summary: Electricity customers’ purchased units are subject to a foreign exchange rate fluctuation adjustment calculated under the stated formula.
2. All electrical energy units purchased by electricity customers shall be liable to a Foreign Exchange Rate Fluctuation Adjustment which shall be calculated in accordance with the following formula: Foreign Exchange Rate Fluctuation Adjustment in TZS/kWh calculated to 25 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) the nearest Shilling: Where: Ft-l Pt-l St-l G Sum of the foreign currency costs on non fuel cost items incurred by a generation licensee in the quarter preceding the first month of the following quarter; the foreign currency costs paid by the Sum of Transmission System Operator and the distribution or supply licensee in the quarter preceding the first month of the following quarter; Sum of the foreign currency costs paid by the System and Market Operators in the quarter preceding the first month of the following quarter; licensee means Total of all units purchased by a distribution or from Electric Power Producer(s), supply generated by a generation licensee and net imports during the quarter preceding the first month of the following quarter, including Off-Grid power stations and imports; L means the Target System loss factor in transmission and distribution systems; and Zt The factor Zt is the proportionate change in the exchange rate (Xt) in the current Billing Period t from the Base Exchange rate (Xo) in the base period and shall be determined according to the following formula: where: Xt actual mean exchange rate obtained by the licensee as reported by the Bank of Tanzania for the quarter preceding the first month of the following quarter; Xo mean exchange rate which was used in the computation of approved tariffs for the given tariff period; Inflation Adjustment - 3 Verify source ↗
Section 3
AI-assisted research summary: Electricity tariffs listed here must be adjusted for inflation every six months, starting on a date set by the Authority.
3. All Tariffs for electrical energy specified above shall be liable to an Automatic adjustment for inflation at the end of every six months period starting from the date to be specified by the Authority. The effect of domestic and international inflation on cost of supply shall be calculated in accordance with the following formula: 26 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) Where INFAt = means Total Inflation Adjustment in TZS/kWh for the half year period t. The first adjustment shall be effected on the date to be specified by the Authority; L = Gp= means the Target System loss factor in transmission and distribution systems; means the Total Units generated or purchased by a distribution or supply licensee from Electric Power Producer(s), during the half-year Adjustment Period. This shall also include other power plants to be constructed and in respect of which a distribution or supply licensee shall enter into a Power Purchase Agreement with Electric Power Producers. INFAGen means a total of inflation adjustment relating to non-fuel costs of generation facilities of the licensee which shall be determined as follows: Where Where INFAKPi means Specific Inflation Adjustment in half-year period, relating to generation licensee's contracted plant i, which shall be determined as follows: KPi means contracted capacity for generation licensee's plant i in kW; FOMCRbi means the base Fixed Operation and Maintenance Charge for generation licensee's plant i in TZS/kW/year, divided by two; means Units purchased from licensee's plant i in kWh in the half-year Adjustment Period; GKi VOMCRbi means the base Variable Operation and Maintenance Charge or variable energy charge rate as applicable, for generation licensee's plant i in TZS/kWh; CPIUt means the Underlying Consumer Price Index for the month of March for adjustments effected in the period July – December; and September for adjustments effected in the period January – June every year as posted by the Tanzania National Bureau of Statistics; 27 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) CPIUb means the Underlying Consumer Price Index for September 2017 as posted by Tanzania National Bureau of Statistics; USCPIt means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for the month of March for adjustments effected in the period July – December; and for September for adjustments effected in the period January – June every year; USCPIb means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for September 2017; INFAT&D Is the Specific Inflation Adjustment in half-year period, relating to transmission and distribution operation and maintenance costs, which shall be determined as follows: CPIUb Where, TDOMb means the transmission and distribution network operation and maintenance costs excluding depreciation of assets and provision for bad debts in the previous year, divided by two; means the Underlying Consumer Price Index for September 2017 as posted by Tanzania National Bureau of Statistics; means the Underlying Consumer Price Index for the month of March for adjustments effected in the period July – December; and September for adjustments effected in the period January – June every year as posted by the Tanzania National Bureau of Statistics; CPIUt USCPIb means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for September 2017; USCPIt means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for the month of March for adjustments effected in the period July – December; and for September for adjustments effected in the period January – June every year. INFASO&MO Is the Specific Inflation Adjustment in half-year period, relating to the operation and maintenance costs of the System Operator and Market Operator, which shall be determined as follows: where, SMOMb means the System and Market Operators’ base costs of operation and maintenance excluding depreciation of assets and provision for bad debts in the previous year, divided by two; 28 Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) GN. NO. 396 (Contd.) CPIUb CPIUt means the Underlying Consumer Price Index for September 2017 as posted by Tanzania National Bureau of Statistics means the Underlying Consumer Price Index for the month of March for adjustments effected in the period July – December; and September for adjustments effected in the period January – June every year as posted by the Tanzania National Bureau of Statistics; USCPIb means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for September 2017; USCPIt means the “Consumer Prices Index for all urban consumers (CPI - U) for the US city average for all items 1982 - 84 =100" as published by the United States Department of Labour Statistics index for the month of March for adjustments effected in the period July – December; and for September for adjustments effected in the period January – June every year. Note: Any difference between the total inflation costs and the actual billed amount for a given half year adjustment period shall be adjusted for in the following half year period. Dodoma, 11th May, 2021 GODFREY H. CHIBULUNJE Director General 29
Provision text is displayed from LexChat’s stored statute record. Use the official source links to verify amendments, commencement, and current legal force.
Ask AI about this statute
The Energy and Water Utilities Regulatory Authority (Electricity and Natural Gas) (Tariff Application and Rate Setting) Rules, 2021
Sign in to ask AI about this statute
Sign in to start authenticated, citation-grounded statute research.
Sign in