Page 12 - AfrElec Week 30 2022

AfrElec TARIFFS AfrElec

Zimbabwe increases power tariff by

8% to meet cost of production

ZIMBABWE ZIMBABWE’S power utility ZESA Holdings on July 24. From August, Zimbabwe will start
(ZESA) has increased the electricity tariff it receiving 100MW from Zambia under a three-
charges exporting companies, reports say. year deal worth $6.3mn per month. Zambia
It quoted a letter to local mining companies recently announced it has a surplus of 1,156MW
by ZESA executive chairman, Sydney Gata after it commissioned four out of five units at a
which says the parastatal will no longer charge 750MW hydro generator.
them tariffs below cost of production as it is “ZESA has been charging an average tariff of
struggling to service “ballooning power import 9.86cents/kWh for exporting customers other
debt.” than ferrochrome smelters, which is below
As a result, exporters, including mining cost, and hence has been failing to capacitate
houses and manufacturing companies, will the utility to ensure the security of power sup-
be charged 10.63 cents per kWh from August ply and efficient service delivery. At the current
1, Gata said in the letter. Power from Hwange tariffs, ZESA is failing to refurbish the genera-
thermal plant, which is under expansion to add tion, transmission and distribution network to
300MW by October/November and another improve service delivery,” South African paper
300MW by March 31, 2023, is produced at 10.7 said TimesLive reported on Friday (July 29), cit-
cents/kWh, translating to 12 cents for customers, ing Gata’s letter.
he said. The utility has agreements to import from
“ZESA will no longer be able to continue sup- Zambia and Mozambique but has not drawn
plying electricity to exporting customers at 9.86 all the electricity stipulated in the contracts
cents as it is unsustainable,” he said, as quoted by since January 2022 due to lack of funds. It has
Bloomberg on Thursday (July 28). up to Sunday (July 31) to start doing so, failure
The southern African country generates an to which the contracts will be cancelled and the
average 1,200-1,300MW but demand is around supplies sold to other customers in the southern
1,800MW. It meets the shortfall through imports African region, the paper said.
from South Africa and Mozambique as well as “Zimbabwe will stand to lose heavily as these
rationing supplies. contracts are long-term, and at a competitive
The country is importing 50MW from price,” said Gata.
Mozambique but is negotiating for 150MW ZESA, he said in March, needs $17mn
more, state-owned The Sunday Mail reported monthly to pay for electricity imports. ™

P12 www. NEWSBASE .com Week 30 28•July•2022