No UNELCO electricity bills increase despite fuel price rise: Gov’t

April 20, 2026 11:20 pm | Posted in Business News | Share now TwitterFacebook

By Doddy Morris.

The Government of Vanuatu has confirmed that electricity bills will remain unchanged, despite a sharp rise in domestic fuel prices, following targeted subsidy arrangements agreed with utility provider UNELCO.

The confirmation comes after fuel price adjustments announced on 17 April 2026 began taking effect. Petrol (benzine) has already increased from VT166 per litre to VT223 per litre as of 18 April.

Diesel is also set to rise from VT155 per litre to VT254 per litre, with the adjustment taking effect early this week. In addition, mazut is expected to increase next week, according to information reported by the Daily Post, adding further pressure on electricity generation costs.

According to the Government, electricity tariffs have been shielded through a subsidy mechanism approved by the Council of Ministers. The support is designed specifically to offset higher fuel input costs used in power generation, ensuring households and businesses do not bear the impact through higher electricity bills.

Prime Minister (PM) Jotham Napat said fuel price increases are driven by global geopolitical tensions in the Middle East, particularly involving the United States, Israel and Iran, which have disrupted supply chains and pushed up international oil prices.

“These developments are beyond the control of the Government of Vanuatu and are affecting countries worldwide,” the PM said. “As a small island developing state, we remain highly vulnerable to these external shocks, and fuel prices are determined entirely by international markets.”

He said the Government’s priority is to protect essential services through targeted intervention rather than broad-based subsidies.

“With the subsidy mechanism in place for electricity generation, households and businesses will not see an increase in electricity bills,” he said. “Government is focusing support where it is most critical to prevent cost increases being passed on to consumers.”

The subsidy forms part of a broader six-month temporary support package targeting key sectors, including electricity, sea and air transport, public land transport and agriculture.

The Government has also held discussions with the Public Land Transport Authority (PLTA) to ensure transport subsidies prevent any increase in bus fares and related costs.

However, officials acknowledged that the Government cannot cushion all fuel users due to the scale of the price increases. Citizens are being urged to reduce fuel consumption where possible, including limiting unnecessary travel, maintaining vehicles properly and considering carpooling.

Authorities have also warned against fuel stockpiling or resale at inflated prices, stating that monitoring will be strengthened to ensure fair distribution.

“The factors driving these increases are outside national control,” PM Napat said. “But Government will continue to act responsibly to protect livelihoods and essential services while closely monitoring global developments.”