ZIMBABWE risks sinking into a deeper power crisis amid reports that the country’s power utility Zesa is on the brink of collapse due to an unsustainable tariff regime, NewsDay has learnt.
The power utility is also said to be drowning due to a
US$37 million legacy debt, mostly caused by mining companies, revenue leakages,
corruption and mismanagement over the years.
Government has insisted on unsustainable tariffs, largely
to avoid a public outcry as the country heads towards the 2023 polls.
Currently, Zesa charges the equivalent of US$0,02 per kWh
versus generation and import costs of between US$0,09 and US$0,11/kWh.
Industrialists yesterday suggested that the power utility
should increase tariffs to guarantee availability of power to industries.
Miners, farmers and manufacturers have been depending on
diesel during power outages that can last up to 18 hours.
Some companies such as Caledonia’s Blanket Mine, Zimbabwe
Consolidated Diamond Company and Tanganda Tea Company have come up with
alternative power sources such as solar plants, which have cost them millions
of United States dollars to set up and maintain.
Information gathered by NewsDay yesterday indicated that
Zesa has applied for a tariff review, but the government was yet to approve it.
Finance minister Mthuli Ncube said the country would have a
cost-reflective tariff this year, but there is yet to be any movement in that
regard.
Analysts yesterday said without a sustainable tariff, Zesa
could sink.
Economist Eddie Cross said: “Any measures by the government
which require State-owned corporations to sell a product or service on the
market at below production costs must be abandoned immediately as it
automatically undermines the ability of the parastatal to be sustainable. With
this situation, Zesa’s future is doomed because it won’t be able to borrow
money or secure a future of production and that is exactly the same problem
being faced by South Africa.”
Former Energy minister Fortune Chasi said Zimbabwe urgently
needed a cost-reflective tariff to save Zesa from collapse and to avert an
electricity crisis.
“However, the new tariff should neither be inflated by
greed and corruption nor legacy issues. The cost-reflective tariff is
essential, but factors building up the overall cost must be justified, in other
words it must be justifiable in reflecting the cost of generating or importing
electricity, not something that is because of premiums arising from corruption
and mismanagement,” Chasi said.
Zesa had not responded to questions from NewsDay at the
time of going to print.
But indications were that the parastatal was in distress
after it recently extended a begging bowl to big miners constituting a group called
the Energy Intensive Users Group to provide off-take guarantees in hard
currency for joint access to power as electricity shortages wreak havoc in the
country.
This was revealed recently at the Zimbabwe International
Trade Fair by the Zimbabwe Electricity Transmission and Distribution Company
(ZETDC) chairperson Howard Choga, who said ZETDC was owed in excess of $1
billion by commercial and domestic consumers.
The power utility currently needs about US$2,5 billion to
end load shedding and was battling to get its monthly foreign currency
requirements of US$17 million from the central bank to import electricity.
The country has a power deficit of about 1 600MW. Newsday
0 comments:
Post a Comment