The national power utility, Namibia Power Corporation (NamPower), is struggling to enforce its credit control and debt management policy, especially against public sector customers.

This is according to the power utility’s managing director, Simon Haulofu.

In December 2025 the Electricity Control Board (ECB) revealed that NamPower is owed N$912 million by its customers, the public sector and various local authorities.

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“The application of the policy is subject to legal, regulatory and shareholder considerations, particularly in respect of public sector customers,” he says.

Haulofu acknowledges that continued non-payment has direct implications for national electricity security.

“The continued growth of overdue electricity accounts is a serious concern, as it directly impacts NamPower’s cash flow, operational capacity and ability to maintain and expand electricity infrastructure to ensure long-term security of supply,” Haulofu says.

He says while NamPower has thus far managed to sustain operations, there is a need to urgently resolve matters at a structural and shareholder level.

By November, local authorities including the Mariental municipality owed N$233.29 million, Gobabis municipality N$70.2 million, Karasburg municipality N$59 million, Aranos Town Council N$58 million, Maltahöhe Village Council N$34 million, Gibeon Village Council N$24 million and Bethanie N$21 million.

The Lüderitz Town Council is also in arrears with N$22 million, Keetmanshoop municipality with N$20 million and the ||Kharas Regional Council with N$10 million.

According to the ECB, these local authorities and some state-owned enterprises breached the repayment arrangements and now account for N$557 million of the debt.

Local authorities under bulk prepayment arrangements owe a total of N$210 million.

The Rehoboth Town Council, which has been under the repayment arrangement since May 2024, still owes N$12 million.

However, the town has been fully converted to prepaid electricity, with the rollout to other customers underway.

Attempts to obtain clarity from municipalities with the highest debts yielded limited responses. The Lüderitz municipality has said it could only provide details on Monday.

The Keetmanshoop and Mariental municipalities have given the same response, stating that their officials would be able to respond next week.

Efforts to obtain a response from the Gobabis municipality have also been unsuccessful.

It’s chief executive, Sophia Eises, referred the questions to the municipality’s public relations officer who could not be reached.

The Namibian had sought to confirm the exact amounts owed by each municipality, understand the factors contributing to the accumulation of debt and inquire about current repayment arrangements and measures to prevent further arrears.

The Ministry of Industries, Mines and Energy also did not respond to queries by the time of publication.

These towns and villages are directly supplied power by NamPower as there are no regional electricity distributors in the Hardap, ||Kharas and Khomas regions.

In 2023 NamPower threatened and even temporarily implemented power cuts for defaulting municipalities and large customers due to high debt.

At the time, Cabinet directed the company not to suspend power supply to defaulting local authorities and other clients due to broader socio-economic and service delivery implications.

Cabinet has since established a dedicated committee to assess the situation and develop recommendations.

There is little evidence of visible progress, and Haulofu confirms that in the meantime NamPower continues to supply electricity pending the finalisation of the committee’s recommendations or position paper.

“In the interim, NamPower continues to apply a risk-based credit control approach, balancing revenue protection with its mandate as a national utility,” he says.

Haulofu adds that NamPower is participating in a shareholder-established committee tasked with assessing the debt challenge and proposing solutions.

According to him, progress has been made, and further guidance on timelines and recovery targets will be communicated once the committee’s work is finalised.

Haulofu has referred The Namibian to the Ministry of Urban and Rural Development for information on the expected timeframe for the completion of this process.

Questions sent to the Ministry of Urban and Rural Development were not responded to by the time of publication.

Minister James Sankwasa has referred the queries to the executive director, noting that the official would only be in office on Monday.

Economist Klaus Schade says outstanding electricity payments will increase NamPower’s operating costs, as the utility may need to fund operational expenses or investment in new infrastructure through alternative financial sources, including borrowing.

He says higher costs could result in reduced profits or increased tariffs and that the persistent non-payment of utilities requires careful analysis of the underlying causes.

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“Otherwise, maintenance and new investment could be delayed, which may impact the security of supply,” he adds.

According to the ECB, the public sector, which includes regional councils, government offices, regional electricity distributors and state-owned enterprises, owe NamPower a collective N$72 million.

NamPower is also owed N$70 million by the Angolan power utility National Electricity Transmission Network (RNT).

In December ECB chief executive Robert Kahimise warned of possible supply interruptions, delayed maintenance or future tariff pressures should the debt continue to escalate.

“Unrecovered electricity debt weakens the financial health of suppliers, including NamPower, and can ultimately affect their ability to invest in generation and transmission infrastructure, maintain system reliability and ensure security of supply,” he said.

He said the regulator is tightening oversight by linking tariff approvals to payment discipline.

“Tariff increases are withheld where poor revenue collection or non-payment to NamPower is identified as the primary cause of financial distress,” Kahimise said.

While the ECB does not collect debt, Kahimise said persistent non-payment is treated as a material compliance issue under licence conditions and could trigger corrective action plans, enhanced monitoring or enforcement under the Electricity Act.