Urban Poor Most Vulnerable to Power Cost Increases

Reports that Electricite du Cambodge plans to increase the price of electricity from next month–in some cases by more than 50 percent–has raised deep concerns among ordinary Phnom Penh residents, while the UN Development Project said yesterday that the price hike will most hurt the urban poor.

On Monday, officials from the Electricity Authority of Cambodia said that residents in Phnom Penh and five other provinces would see a raise in consumer power costs in order to provide more revenue for the government following heavy state spending to mitigate the worst impact of the global economic crisis.

“Electricity has become a basic need and the rise of electricity costs would undoubtedly put pressure on everyone, especially the urban poor,” UN Development Program economist Sovannara Lim wrote yesterday in an e-mail.

Residents in Dangkao and Russei Keo districts in Phnom Penh also expressed concerns that they price increase in electricity would further lower their already very modest standard of living.

“For me the rise will be very difficult,” said Pun Peung, 60, a seller of vegetable produce in Dangkao district.

Mr Peung’s consumption of less than 50 kilowatt-hours a month would see his bill increase by more than 50 percent under the new price lists laid out by the Electricity Authority of Cambodia on Monday.

Mr Peung currently pays around 40,000 riel, or about $10 for his electricity each month, which is enough to only powers two fans, one light and a television at his modest wooden house.

Earning around $2 per day, which barely covers his daily food needs, any increase in the price of power will be an added cost Mr Peung can ill afford.

“If the price stays at 390 riel, it is easier for me,” he said.

Russei Keo district resident Sok Chamroeun, 40, a former employee at the Ministry of Industry, Mines and Energy who is now unemployed, said that his district is full of people working in financially precarious jobs and that EdC officials are often pass through, cutting off the power of families unable to pay their bills.

An increase in electricity bills will exacerbate that problem, Mr Chamroeun said, adding that he currently uses about 90 kilowatt-hours per month, and his tariff is currently at 610 riel per kilowatt-hour but will rise to 720 riel under the new pricing regime.

“I am almost out of breath because if the price of electricity increases, it will be harder for me to make a profit,” said Mr Chamroeun’s wife, Leng Sokheng, 30, who works with a sewing machine at their home to earn a small income.

“If the price goes up, some people will become even poorer,” Mr Chamroeun said.

Srey Pich, 30, who operates a small business cleaning motorbikes in Dangkao district, said her family of 10 spends about 100,000 riel, or about $25, per month on electricity, which covers the most basic of power needs in her home.

“My house only has one light, a fan and a television,” she said.

After having worked in a garment factory since 1996, Ms Pich left her factory about five months ago because she could no longer survive on her low wages. With so many mouths to feed in her family, Ms Pich said that she worried that a hike in electricity costs could see her livelihood take a turn for the worse.

“If the price of electricity really goes up, I will have more difficulties than before,” she said.

 

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