Mogadishu residents bemoan electricity service costs

A Benadir Electricity Company (BECO) technician works on the generators at one of the company's power stations in Mogadishu. [Warsame Afrah/Sabahi]

By Warsame Afrah
Friday, November 28, 2014

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MOGADISHU — Six months ago, seven private electricity companies in Mogadishu merged to form the Banadir Electricity Company (BECO) after operating separately for the last 20 years.

The merger aimed to streamline electricity provision and upgrade the grid in the capital city, but since the merger, Mogadishu residents have been complaining about the high cost of services and say they want the government to intervene.

Before the merger, each household paid only for the electricity they consumed, but now BECO has issued a new minimum rate of $10 for each service location.

For many residents who rely on remittances from abroad, the new fees are prohibitive.

Maryam Abdi Gutale, 34, a mother of five, said her electricity was cut off when she failed to pay her $89 bill on time.

Standing at one of the BECO centres in Hamar Weyne Market, she said the company had refused to restore her electricity because of her late payment.

"My family survives on remittances from abroad, and sometimes it comes late," she told Sabahi. "The problem I am facing now is that I have already paid the money, but they have refused to restore my electricity, because the company told me that I have broken the rule that every person has to pay the bill within the first five days of each month or they will be without electricity."

"We are suffering due to the high rate and the lack of an alternative company that provides this service in the city," she said.

BECO provides electricity services to the entire city of Mogadishu except for government agencies, telecommunications companies and major hotels that own private electric generators.

Mohamed Hussein Salad, a 42-year-old business owner who returned to Mogadishu in June after living in the United Kingdom for 15 years, said the high cost of electricity is negatively impacting his ability to create jobs.

Salad opened the Barrow Ice Factory, which serves hotels, restaurants and traders who then resell the ice in neighbourhoods.

Every month he spends between $500 and $600 each on electricity, which he said cuts into his profits and limits his ability to reinvest and expand his business.

"Our company uses its own electric generators, but we use the electricity when we have to turn off the generators and the cost we are charged for that use is too high," he said.

BECO workers fix a power line in Mogadishu. [Warsame Afrah/Sabahi]

Infrastructure improvements

BECO operations manager Isse Mohamed said the cost of electricity remains high in Mogadishu because it is produced through generators that require diesel fuel, which also makes them more vulnerable to fluctuating costs of oil in the market.

Adding to the costs, he said, is the work the company is undertaking to rebuild the infrastructure needed to reliably distribute electricity throughout the city.

Since the companies merged, he said, large diesel generators have been placed in every neighbourhood, and new vehicles enable company employees to quickly respond to the needs of the people.

BECO also organised loose wires that had posed a safety hazard, particularly during wet weather, and has introduced electricity poles, Mohamed said.

"We have reduced the cost of electricity in some locations by 30%," Mohamed told Sabahi, adding that the company charges between $1 and $1.30 per kilowatt, depending on the neighbourhood.

"Some neighbourhoods, such as around the presidential compound and KM-4, are densely populated and the cost of living is high, but the cost is lower in the sparsely populated areas," he said.

Despite the infrastructure improvements, the electricity companies' merger could result in problems for the public, said professor Ali Yasin Ali, who teaches business research at Somalia University and SIMAD University.

Forcing customers to pay a high rate for electricity they have not used and to incur the cost of basic equipment such as the company's electricity metre to get service can be too burdensome for many consumers, he said.

If the company continues charging at the current rate, it could halt the country's fledgling economic progress, he added.

To curb the rising prices, Ali urged Somalia's federal government to take the lead in rebuilding the country's electric grid and supporting infrastructure with help from international partners.

"Building the electricity [infrastructure] is a very big project that could cost a lot of money, and the government needs to collaborate with other [foreign] governments," he said.

Until that is possible, Somalis will be forced to rely on the private company and continue paying a premium rate for their service, he said.

Reclaiming public buildings

For its part, the Somali government has begun taking steps to re-launch the state-owned electric company and reclaim its properties.

In a statement issued October 30th, Minister of Energy and Water Jama Ahmed Mohamed ordered squatters who live in former electricity distribution centres and buildings to vacate the premises.

"If you have lived there for 23 years and have raised your children there, today the time has come when they should be used to benefit the public," he said, without specifying a deadline for squatters to move.

He said that in January the ministry will start projects to revive the state-owned electricity and water companies with support from friendly governments.

However, internally displaced people affected by the order who spoke to Sabahi said they do not have the money to move or a place to go and urged the government to provide relocation assistance.

Abdirahman Bishar Yusuf, 45, said he has lived for 16 years in the former electricity production centre in Hawl Wadag district.

Yusuf told Sabahi he has no place to move his family of seven children at this time.

"We heard on the news that the government wants to evict us from where we live," he said. "We know that these are public buildings, but we do not have anywhere else to go. We ask the government to think about an alternative location where we can live."

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