The Board of Directors of Energy and Water Utilities
Regulatory Authority (EWURA) has turned down an application by the Independent
Power Tanzania Company Limited (IPTL) for an extension of its Electricity
Generation Licence for 55 months (4 years and 7 months).
On 28th March 2017, IPTL submitted the application
seeking for an extension from
16th July 2017 to 15th January 2022. A statement
issued yesterday by the EWURA management explained that after deliberating on
the application, the board rejected the application basing on three factors.
Firstly, he explained, was the exorbitant capacity
charges. “The effect of allowing the application for licence extension to the
electricity price to be paid by consumers including the continued payment of
USD 2.667 million per month as capacity charges,” stated the statement.
The board decision also based on objections received from
the public and other stakeholders and pending legal disputes involving IPTL.
The rejection of IPTL’s application comes a few months after the arraignment of
two alleged key players in the infamous 306bn/- Tegeta escrow account scandal.
The two, the Director of VIP Engineering and Marketing,
Mr James Rugemalira and Mr Harbinder Singh Sethi of Pan Africa Power Solutions
Tanzania Limited (PAP), have appeared at the Kisutu court facing six counts of
economic sabotage and occasioning a loss of US $ 22.1 million dollars and
309bn/-.
The prosecution informed the court that between October
18, 2011 and March 19, 2014, in Dar es Salaam, they conspired to commit
offences in South Africa, Kenya, India and elsewhere.
The court heard that between November 28 and 29, 2011 and
on January 23, 2014 at the Stanbic Bank headquarters at Kinondoni and Mkombozi
Bank, St. Joseph Branch, the two businesspersons through deceit, received the
said amount from the Bank of Tanzania (BoT).
Before the arraignment of the duo, the Director General
of Prevention and Combatting of Corruption Bureau (PCCB), Mr Valentino Mlowola,
told a news conference that the agency had all along been investigating the
scam which rocked the country in 2014.
The scandal involved the transfer of 309bn/- from an
escrow account at the Bank of Tanzania (BoT), where it was jointly opened by
Tanzania Electric Supply Company (TANESCO) and IPTL, pending legal wrangles
over capacity charges between the parties before domestic and international
courts.
IPTL which operates dieselfired turbines at Tegeta in Dar
es Salaam was initially founded through a joint venture between a Malaysia
company, Mechmar (70 per cent) and Mr Rugemalira’s VIP Engineering and
Marketing Limited (30 per cent).
It is still unclear how Mechmar sold-off its shares to
another company PiperLink of British Virgin Island which later allegedly sold
its stake to Mr Sethi’s PAP. Billions of shillings were then paid to Mr Sethi
from the account after he convinced officials that he had acquired the 70 per
cent stake in IPTL.
He then proceeded to acquire the 30 per cent stake which
was owned by VIP Engineering and Marketing. To reach a deal with Mr
Rugemalira’s company, it is said that Mr Sethi had to pay a whopping US $75
million dollars (about 165bn/-) to acquire the 30 per cent.
During the parliamentary session in November 2014, the
august House made eight resolutions, one of which was for investigations and
arrest of all people who were involved in the scandal. The resolution followed
a report by a special committee of the parliamentary Public Accounts Committee
(PAC) which was formed to probe the affair.
As the scandal ravaged on with calls for actions from
Parliament and subsequent investigations by PCCB and audits by the Controller
and Auditor General (CAG), several top government officials were sacked while
others resigned.
Among those who resigned were the then Minister for
Energy and Minerals Sospeter Muhongo and Attorney General Fredrick Werema,
while Prof Anna Tibaijuka, then Minister for Lands, Housing and Human
Settlements Development, was fired by former President Jakaya Kikwete.
The former UN Habitat boss was fired after it emerged
that she had been paid 1.6bn/- by Mr Rugemalira. The funds were suspected to be
part of monies from the escrow account. The list of other individuals said to
have pocketed some of the funds include former Minister for Energy and Minerals
William Ngeleja and former Attorney General Andrew Chenge.
Source: Daily News TZ