Electricity - AES-sonel Lease Under Review

The government of Cameroon wants to review the outline lease, license and derivative contracts with the country's sole hydro energy supplier, AES Sonel. A call for tenders to recruit a consultant to assist government in the review has been launched by the contracting authority, the Ministry of Water Resources and Energy.

According to the terms of the tender, bids are expected from national consulting firms and bidders must show proof of experience in similar missions. The release launching the tender stipulates that the services of the consultant will consist in analysing and giving expert opinion on the contracts. The consultant will assist government in understanding all the legal and financial implications in reviewing the outline concession, license and derivative contracts and other specifications.

Where need be, they would also formulate amendments to existing legal instruments. Besides supporting the project team in the substantive organisation of meetings of the groups of experts responsible for examining and concluding the project, the consultant will equally be tasked with supervising negotiations, the drafting and finalisation of riders of AES Sonel contracts. They will also provide AES Sonel with a detailed report on recommendations made.

The bids, the release further states, will be opened by the Tenders Board of the Ministry of Water Resources and Energy on September 18, 2012 and the maximum period provided for the submission of the report is six months. All attempts to obtain supplementary information from the ministry on what prompted the review, the terms of the current lease as well as what could change and its impact on AES Sonel services failed.

However, recent happenings in the sector lend credence to the fact that there is a hole whose timely stitch could save nine. For example, in 2010, AES Sonel reportedly unilaterally upped the prices of electricity consumption. Not only did government step in energetically to halt the move, but heads also rolled at the Electricity Sector Regulatory Board (ARSEL); apparently as a result of the controversial move. Government finally authorised the electricity price increment on May 28, 2012. According to the new tariffs, for example, consumers of between 111 and 400 kwh per month since June 1 have been paying FCFA 79 per kwh, up from FCFA 70.

According to the network of energy consumer associations (RACE), the revision of the lease is a golden opportunity for government to right some wrongs in the sector that have greatly disfavoured electricity consumers in the country for years. They include power outages, the destruction of electrical appliances, controversial billing, harm to human life, et al.