Proclamation No. 141/2004

The Electricity Proclamation

Article 1: Short Title

This Proclamation may be cited as the "Electricity Proclamation No.141 /2004."

Article 2: Purpose

The purpose of this Proclamation is to promote efficient, dependable, safe and economically sustainable electricity operations in Eritrea as well as private sector and community participation in the same.

Article 3: Definition

Unless the context otherwise requires, in this Proclamation:

1."Customer" means a person obtaining electricity services against payment of fee.

2."Electrical Installation" refers to electricity/power generation plants, power lines, substations, and other related devices connected to the power lines.

3.”Electricity operations" refers to generation, transmission, distribution and sale of electricity.

4. "Government" means the Government of Eritrea.

5."Permit" means a permit issued in accordance with the provisions of this Proclamation to undertake electricity operations and a "Permit holder" means a person who holds such a permit to undertake such activities.

6."Minister" or "Ministry" means the Minister or Ministry of Energy and Mines, respectively.

7. "Person" means any juridical or natural person.

Chapter II

Establishment and Function of the Electricity Regulatory Committee

1. The Electricity Regulatory Committee (hereinafter referred to as the "Regulator") is hereby established as a juridical person.

2. Thehead office of the Regulator shall be in Asmara and branch offices may be established elsewhere in Eritrea.

1.The Regulator shall be composed of a minimum of five members with the necessary skill and competence two of whom shall be from the private sector.

2.The Regulator shall have a chair-person who along with the other members of the Regulator, shall be appointed by the President of the State of Eritrea.

3.The chair-person shall represent the Regulator in all its dealings with third parties. The chair-person may delegate one of the Regulator members to act on his/her behalf during his/her absence.

4.The Regulator shall have a secretary who shall be appointed by the Minister and attend all meetings of the Regulator with no voting right and record its proceedings.

The Regulator shall have the duties and responsibilities to:

a. promote efficiency, dependability, cost-effectiveness, safety and quality of services and fair competition as well as private and community participation in electricity operations in Eritrea;

b. supervise and ensure that electricity operations (generation, transmission, distribution and sale of electricity) are carried out in accordance with this Proclamation as well as regulations to be issued hereunder;

c. study, review and determine electricity tariffs and related service charges on the basis of general guidelines and principles issued by the Ministry on setting same and oversee the implementation thereof;

d. initiate and conduct investigation into standards of quality of services provided to customers and monitor standards of overall performance of permit holders;

e. protect the interests of customers, permit holders and the general public;

f. investigate complaints made by parties with grievances over any matter regulated under this Proclamation as well as regulations issued there-under and give its ruling thereon;

g. where it discovers on its own motion or upon a complaint and after hearing the permit holder that the person has not been complying with the provisions of this Proclamation, instruct him in writing to adhere to and fulfil his obligations under this Proclamation within a reasonable time;

i.   perform such other lawful activities as may be necessary for the attainment of its objectives.

1. The secretary shall:

a. subject to general directives of the Regulator, manage the day­-to-day activities of the Regulator and execute its decisions:

b. collect, compile and analyse data on the power sector deemed necessary for the discharge of tasks of the Regulator: and

c. prepare the budget and keep proper books of accounts, financial records and reports of activities of the Regulator.

1. A Regulator member shall be appointed for a period of five years.

2. A member of the Regulator whose term of office terminates may be eligible for reappointment.

Article 9: Vacation of office

1. The office of a Regulator member becomes vacant if he or she:

a. is absent for five consecutive meetings of the Regulator without the permission of the chair-person;

b. resigns by notice in writing to the chair person, or is removed from office due to by physical or mental illness, or for any other good cause which renders such-person unable or unfit to discharge the functions of a Regulator member.

Article 10: Meetings of the Regulator

1.The Regulator shall hold regular quarterly meetings.

2. Special meetings may be convened upon the request of the majority of its members or the chair-person.

3.The quorum at a meeting shall require the majority of members.

4.Matters before Regulator meetings shall be decided by a majority of votes of the members present and voting in the meeting. In case of equal votes the chair-person shall have a casting vote.

Article 11: Budget and Accounts

1. The budget of the Regulator shall be drawn from the following sources:

b. money accruing to the Regulator from any other source.

2. The financial year of the Regulator shall be the same as that of the Government.

3. The books of accounts and all financial affairs of the Regulator shall be audited by the Auditor General or by an auditor designated by him.

Article 12: Requirements of Permit

1. No person may generate, transmit, distribute or sell electricity for commercial purposes or construct, maintain or operate power plants and electrical installations without a permit from the Ministry.

2.   Financial and technical capacities shall constitute pre-requisites for granting a permit to undertake electricity operations.

Article 13: Suspension and Revocation of Permit

1. A permit issued under this Proclamation may be suspended or revoked by the Ministry, where upon the recommendation by the Regulator and upon hearing the permit holder, the Ministry is satisfied that the Permit holder is not operating in accordance with the provisions of this Proclamation.

2. Prior to suspension or revocation of a permit, the permit holder shall be granted reasonable time to rectify deficiency or failure.

Article 14: Obligations of a Permit Holder

a. maintain in good condition and/or upgrade and expand installations, equipment and property used in electrical operations to provide appropriate service to the public,

b. make all reasonable efforts necessary to provide safe, adequate, efficient, reliable and non-discriminatory electricity service/supply to the public;

c. apply and pursue cost-effective commercial standards on electrical tariffs and related service charges in accordance with the provisions of this Proclamation and regulations to be issued hereunder;

d. take necessary measures to protect the safety of the public and the environment from any damages that may arise from its operations and related activities;

e. to obtain the prior approval of the Regulator of supply/service model contracts to be concluded with customers; and

f. keep all employment, financial, commercial and other books and records as well as records of electricity operations.

a. enter land or premises in the holding of any person in the area covered by the permit and carry out activities necessary to undertake electricity operations;

                     b. free access necessary to undertake electricity operations;

c. disconnect any customer who fails to pay his/her bills and comply with his/her other contractual obligations; and

2. The procedures pursued in the setting of electricity tariffs and related service charges and terms of electricity supply shall consider, inter alia, the ability of the permit holder to:

a.   maintain financial integrity;

b. attract capital;

c. operate efficiently;

e. fully compensate investors for the risks assumed; and

f. to the extent possible consider issues of social equity.

3. Any proposed change in an effective rate or tariff schedule shall be filed with the Regulator for approval.

4. No permit holder may charge in excess of the approved tariffs or related charges.

1.Any master plan of a town shall demarcate and show the electricity supply-system layout thereof.

2.A permit holder shall, while erecting electrical installations, comply with the master plan of the town.

3.If any change or modification in the town plan necessitates displacement of existing electrical installations that were erected in compliance with the town plan before the change, the body causing and or authorising such a change in the town plan shall compensate the permit holder for the cost subsequently incurred.

1.No construction, farming, plantation or any other activity of a permanent nature may be carried out within the clearance zone to be set by regulations adjacent to electric installations.

2.If a new road or other construction structure requires changes in existing electrical installations, the owner of the new road or construction shall compensate the permit holder for the resulting cost.

3.If the construction of new electrical installations requires changes in already existing constructions, the permit holder shall compensate the owner of the construction for the resulting cost.

Chapter V: Miscellaneous Provisions

Article 19: Liability and Compensation for Damages

1. The Permit holder shall pay compensation, according to Eritrean law, for damages caused to the property of a person legally entitled to use the land while acting under Article 15 hereof.

2. The liability for damages caused by electricity from a permit holder shall be dealt with in accordance with the Civil Code of Eritrea.

Article 20: National  Grid

1.The Minister may, by notification, determine several transmission and distribution networks with different voltages to constitute the national grid,

2.Access to such networks by a permit holder is possible under the terms and conditions determined by regulations to be issued by the Minister.

Article 21: Technical Safety

1. Electrical installations and operations shall meet the standards of Technical and Safety Requirements adopted by the Ministry.

2. The Ministry reserves the right to update the Technical and Safety Requirements as it deems necessary.

Article 22: Rural Electrification Fund

1. The Minister may by internal directive establish a rural electrification fund (hereinafter "The Eritrean Rural Electrification Fund" or the "Fund") by imposing a levy not exceeding 1 % on all electricity sold.

2. The Fund shall be used to support electrification of rural areas and other areas considered economically nonviable for electrification by the permit holder.

3. The Fund may, in addition to receiving the proceeds of the electricity levy established under sub-Article (1) hereof, also benefit from Government budget support and/or contribution from beneficiaries and from local and external grants, donations or loans.

4.   The Fund shall be administered by the Ministry and utilised on the basis of transparent and fair criteria and shall be audited and accounted for.

Any person aggrieved by a decision of the Regulator or the Minister under this Proclamation may appeal to the High Court within 30 days from the date the decision is given. The decision of the High Court on the appeal shall be final.

Any electric utility, however established and in existence at the commencement of this Proclamation shall within one month of the commencement of work by the Regulator submit for approval to the Regulator in writing its existing and proposed tariffs rates for the utility service it provides..

The Minister may issue regulations necessary for the proper implementation of this Proclamation

Article 26: Entry into force

This Proclamation shall enter into force as of the day of its publication in the Gazette of Eritrean Laws.

Done at Asmara this 7^th day of May, 2004