. . . as PAC slams fast-track Christmas Eve approval
. . . fears eerie similarities to the Frazer Solar fiasco
Mohloai Mpesi
THE Lesotho Water and Electricity Authority (LEWA) has come under intense scrutiny over the controversial approval of a M2.10 per unit electricity tariff in favour of Beijing Jingyuntong Technology Limited Cooperation (BJT), a Chinese firm contracted to build the second phase of the Ramarothole Solar Project.
The approval, which took place on Christmas Eve in 2024, was revealed during a heated Public Accounts Committee (PAC) session this week, where members grilled LEWA’s board of directors and executive management over what they described as a reckless decision that would burden ordinary Basotho for many years to come.
PAC was chaired by ’Machabana Lemphane-Letsie and included Revolution for Prosperity (RFP) Members of Parliament for Mokhethoaneng, Matala, Motimposo, and Makhaleng constituencies; Makhothu Makhalanyane, Tšeliso Moroke, Makatleho Motsoasele, and Mootsi Lehata.
The PAC session also included Thabiso Lekitla from the Democratic Congress (DC) representing the Mekaling constituency, and Montoeli Masoetsa, a Proportional Representative (PR) from the All Basotho Convention (ABC).
LEWA, which regulates utilities including the Water and Sewerage Company (WASCO) and the Lesotho Electricity Company (LEC), was grilled for granting tariff approval under questionable circumstances.
According to PAC, LEC had submitted a proposal to LEWA on 17 December 2024 requesting approval of the tariff agreement with BJT. However, the board convened and granted approval on 24 December 2024, a day after Cabinet reportedly gave the nod on 23 December 2024 – suggesting that Cabinet approved LEWA’s recommendation before the board had formally met.
PAC members expressed alarm at the timing and urgency of the meeting, questioning why LEWA would interrupt the festive period to rush such a critical decision, particularly in the absence of a signed Power Purchase Agreement (PPA).
According to the agreement signed between the government of Lesotho and BJT on 8 June 2025, BJT would charge LEC M2.10 per unit, with the rate escalating by five percent annually over 15 years. The committee warned that such an arrangement would inevitably lead to LEC increasing its tariffs to consumers, possibly pushing the cost up to M4.00 per unit – an unsustainable rate on the already struggling ordinary citizens.
BJT was awarded the contract for the Build, Operate, and Transfer (BOT) development of a 50MWp Solar Photovoltaic Plant and 20MWh Energy Storage System in Mafeteng, marking Phase II of the Ramarothole project.
The PAC questioned why LEWA could not wait until after the holidays to finalise its decision, especially when Cabinet approval appeared to precede LEWA’s own deliberations.
To make matters worse, LEWA’s board approved the tariff before a PPA had been signed.
“We have tangible evidence of the meeting of the 24th of December where they (LEWA) approved tariffs of M2.10,” said Dr Moroke.
Ms Lemphane-Letsie pressed for answers: “The board sat on Christmas Eve, there is no PPA signed by LEC, but the board approved a tariff that LEC is going to use to purchase electricity at M2.10. We need an explanation.”
In response, LEWA Chief Executive Officer, Motlatsi Ramafole, admitted that LEC had indeed applied for tariff negotiations with BJT, adding that although there was no PPA, a negotiated price had been reached.
“LEC filed an application for tariff negotiations between them and BJT. Yes, there is no PPA, but there is a negotiated price,” he said. “At the time BJT applied for a license, the license had to be accompanied by a proposed tariff.
“The final approval, which LEC and the generator will be working on, will come out of that PPA, which might be higher or lower than what they have negotiated. PPA sometimes takes about three years . . . So our understanding is that, even though there are these issues now, those are preliminary issues.”
He maintained that LEC’s request was purely for a tariff negotiation.
However, Ms Lemphane-Letsie read aloud from LEWA’s own letter, disputing the CEO’s claim.
“Your letter says: ‘RE: decision on the tariff’. It does not say negotiations. You will recall that LEC requested the authority to review the average tariff of M2.10, unbundled into instantaneous generation dispatch energy tariff of M1.09 and battery storage dispatch tariff of M1.044, negotiated between itself and BJT. Following an assessment of the documentation filed in support of the request, the LEWA board, in its meeting of the 24th of December, considered and approved the proposal as filed. LEC is required to submit a Power Purchase Agreement to the authority for review and approval once finalised.
“The board sat during the Christmas holidays to approve an issue that is yet to be negotiated. What was the reason? It was Christmas! What made the board sit during the holidays to consider a tariff we recognise as incorrect, and for LEC to buy electricity at M2.10 means the ordinary Mosotho will pay M4.00!”
Mr Makhalanyane said the PAC intelligence showed Cabinet approved the matter on 23 December, a day before LEWA met.
“Our investigation reveals that Cabinet sat on the 23rd to approve this issue, which was yet to be decided,” he said. “What information did you have during Christmas to help you make such a decision?”
Ms Lemphane-Letsie echoed: “You sat on 24 December, while Cabinet sat on the 23rd, saying they approved it on the recommendation of LEWA, which was yet to be made. It is a mess.”
Mr Masoetsa raised further red flags, citing a clause in the agreement that states disputes will be settled in Chinese courts and interpreted under Chinese law, a situation eerily reminiscent of the Frazer Solar debacle.
“This is the same M2 we pay to Eskom, whom we are failing to pay now. But you enter an agreement with a Chinese company that says the tariff increases 5 percent annually in US dollars for 15 years. If there are disputes, they will be resolved in China under Chinese law. You have just approved another Frazer Solar!”
He warned that if LEC defaults, the government of Lesotho would foot the bill.
“LEC already owes Mozambique and owes M70 million to Ramarothole. We called you here to confirm what you did. We already know everything.”
He alleged the Minister of Finance and Development Planning, Retšelisitsoe Matlanyane, pushed the deal while abroad.
“She was in America when Cabinet rejected the matter. She convened a virtual meeting and instructed a managing director to go to China. Then she went to China herself. This is another Frazer Solar.”
Board member, Khotso Masheane, attempted to justify the urgency of the meeting.
“The urgency was to ensure that LEC and BJT could start negotiating. From our side, we realised that delaying until mid-January would stall the PPA negotiations. The decision was made so that we weren’t the ones delaying the process.”
However, Mr Makhalanyane warned of long-term consequences.
“The decisions you make will affect the youth and future generations. We expect a level of independence from you that resists political manipulation. We need to review how board members are appointed to prevent them from endorsing flawed and economically harmful processes. Boards are taking wrong mandates from those who appointed them.”
Dr Moroke insisted that the board’s decision is binding, and it will become a serious national liability.
“That agreement is binding. It is now a big problem for this country. I am disappointed in LEWA. This is another Frazer Solar. It is worse. It contains clauses that allow tariff increases by 5 percent annually.”
Board member, Moshoeshoe Ntaote, said the board believed it was legitimate to help initiate negotiations.
“The issue presented to us was the tariff, which was to be included in investment negotiations. We all know Lesotho produces limited electricity, and our external sources are unreliable. I thought it was genuine to facilitate timely negotiations.”
Board chairperson, Makotoko Makotoko, distanced himself from the approval.
“This matter was debated at length, and I objected heavily. I even asked if it was feasible. It was very unreasonable. On behalf of the board, I want to say I denied this.”
In 2018, Lesotho entered into a M1.7 billion controversial energy contract with Frazer Solar GmbH, a German company, for the supply of solar water heaters, batteries, and LED lights.
The contract, signed without broad Cabinet approval, eventually collapsed and Frazer Solar later sued the government of Lesotho for €50 million (about M1 billion) in damages, claiming breach of contract.
Despite Lesotho disputing the validity of the agreement, a South African court granted Frazer Solar the right to attach Lesotho’s global assets in 2020, causing a diplomatic headache and risking Lesotho’s international reputation.
The government has since appealed the South African ruling and the case is still pending before the South African High Court.
This despite the Lesotho Constitutional Court bench comprising Chief Justice Sakoane Sakoane, and Justices Moroke Mokhesi and Realeboha Mathaba, ruling in November 2022 that the tender was invalid because Lesotho’s procurement laws had not been followed.
