Keetmanshoop terminates SELCo contract

THE Keetmanshoop Town Council has terminated its controversial power supply deal with the Southern Electricity Service Company (SELCo).

In the year 2000, the South African-controlled company acquired exclusive 15-year rights to run the electricity and water networks of almost all local authorities in the South, sparking widespread unhappiness and protests from residents over escalating electricity tariffs. The deal was clinched after SELCo gave the Keetmanshoop Municipality N$5 million to upgrade the town’s electricity grid.Keetmanshoop Mayor Simon Petrus Tiboth told a press conference yesterday that the council had unilaterally decided at an extraordinary meeting to terminate the agreement.The council has ordered SELCo to immediately hand over all assets belonging to the municipality Tiboth said.”No matter what the consequences would be, the local authority has decided to take over the electricity control of the town with immediate effect,” he said.The Town Council also instructed the local Police to guard the electric sub-stations to prevent any sabotage attempts.The Namibian has reliably learnt that the council’s decision was prompted when SELCo withdrew royalties paid to the Municipality after the council rejected proposed electricity tariff increases.In terms of the 15-year contract, the local authority was entitled to receive monthly royalties of close to N$150 000.SELCo Managing Director Allen Van Zyl has declined to comment on the termination.The Keetmanshoop Town Council had been trying to renegotiate the agreement after residents complained that their electricity bills had skyrocketed after the outsourcing of the power supply.The SELCo deal has also been seen as hampering the establishment of the Southern Regional Electricity Distributor (RED).The deal was clinched after SELCo gave the Keetmanshoop Municipality N$5 million to upgrade the town’s electricity grid.Keetmanshoop Mayor Simon Petrus Tiboth told a press conference yesterday that the council had unilaterally decided at an extraordinary meeting to terminate the agreement.The council has ordered SELCo to immediately hand over all assets belonging to the municipality Tiboth said.”No matter what the consequences would be, the local authority has decided to take over the electricity control of the town with immediate effect,” he said.The Town Council also instructed the local Police to guard the electric sub-stations to prevent any sabotage attempts.The Namibian has reliably learnt that the council’s decision was prompted when SELCo withdrew royalties paid to the Municipality after the council rejected proposed electricity tariff increases. In terms of the 15-year contract, the local authority was entitled to receive monthly royalties of close to N$150 000.SELCo Managing Director Allen Van Zyl has declined to comment on the termination.The Keetmanshoop Town Council had been trying to renegotiate the agreement after residents complained that their electricity bills had skyrocketed after the outsourcing of the power supply.The SELCo deal has also been seen as hampering the establishment of the Southern Regional Electricity Distributor (RED).