Gov’t Officials Unable to Explain Poverty Equation in Power Price Hike

Officials provided few reasons yesterday as to why the government has decided to spare wealthier consumers from increasing electricity prices that will be soon be paid by the urban poor.

On Monday, the government announced that electricity costs would rise in Phnom Penh and five provinces in order to provide more revenue for the government, following heavy spending during the course of the global economic crisis.

However, for commercial and industrial customers as well as foreign embassies, NGOs, foreigners and international institutions, the price of energy will see a reduction.

Praing Chulasa, director of the Planning and Strategy Unit for state-owned Electricite du Cambodge, declined to comment on the issue when reached by telephone yesterday.

An official at EdC, who spoke on the condition of anonymity, said the rise in electricity prices was based on a policy that aims at benefiting electricity consumers on a “macro” level rather than taking into consideration the circumstances of specific groups.

“I acknowledge those living in urban areas will be affected by this new price,” he said. “But we cannot focus on only the micro aspect.”

“EdC is not created for a group of people but for all, including those in rural and border areas,” he added.

He said that a continuation of the 390-riel tariff for low-level consumers would cost the company too much to sustain. From Feb 1, households using less than 50 kilowatt-hours per month will see their bill increase from 390 riel per kilowatt-hour to 610 riel, a rise of more than 50 percent.

Chea Pheng Cheang, secretary of state of the Ministry of Finance, said he had no idea why the government had decided to raise prices for the poor and referred questions to the Ministry of Industry.

Mey Vanny, director of industry and finance at the Finance Ministry, also said he did not know why the decision had been made to increase prices for the urban poor and referred questions to Net Moni, chief of the state property department in the Ministry of Finance, who could not be reached for comment.

Kang Chandararot, executive director of the Cambodian Institute of Development Study, said he was unaware of the reasons behind the government’s decision, but it was one that could have been made more wisely.

“To promote industry and enterprise by reducing electricity costs is good, but not at the expense of the urban poor,” he said.



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