Ashly DhaniTapiwanashe Mangwiro
Business and industry are grappling with persistent power shortages that are threatening to derail production across key sectors.
As the electricity crisis continues, companies are forced to navigate an unforgiving environment where unreliable power supply not only disrupts operations, but also inflates costs at a time when consumer spending power is at its weakest.
The business community has sounded the alarm saying they are burning resources just to stay afloat, with many facing an uphill battle to maintain production levels. In a nation where peak power demand far outstrips supply, the consequences to an already fragile economy could be catastrophic.
Zimbabwe National Chamber of Commerce (ZNCC) president, Tapiwa Karoro, said it definitely does affect production if electricity is not available because it disrupts processes.
“Some processes must not be stopped midway as they result in losses but it is the situation that we are currently facing. This leads to losses for firms at a time they are struggling to clear stocks due to low disposable incomes in the economy,” he said.
Power utility ZESA, is generating an average of 900 megawatts (MW) daily from its two power stations in Kariba and Hwange, plus other independent power producers. This is against a national demand at peak periods of 2 200MW.
To cover for the shortfall, ZESA is importing from regional power utilities especially from South Africa Power utility, Eskom and Hydro Cahora Bassa of Mozambique.
However, the imports are inadequate as ZESA entered into non-firm contracts with the regional power utilities.
A non-firm contract means that the regional power utilities can only supply if they have surplus.
Economist, Dr. Prosper Chitambara, warned that the ongoing power shortages are exacerbating the economic challenges Zimbabwe faces.
“The impact on production is profound, as energy is a critical input in virtually every sector of the economy. Without consistent power supply, businesses are forced to cut back on production, which in turn reduces their competitiveness and erodes investor confidence,” he said.
Tinashe Mukoko an industrialist said the shortage of power is a huge issue when it comes to business as it is a vital cog of the operations.
“Unavailable electricity is worse than expensive electricity whereby one runs generators to keep producing. That way companies will be eating into their revenues hence the need for dedicated power supply at the rate the power utility would want them to pay and avoid additional costs,” he said.
Mukoko also dismissed the option of using solar power for heavy industries, saying that it is not viable because it varies with the sun’s setting and requires big batteries to avoid power fluctuations.
“Even industrialised countries do not use solar for industrial use,” he said.
The ZNCC president also noted that the power deficit has left them with additional costs, which at the moment are hard to pass on to consumers.
“With less power to use, our members are forced to use alternatives such as diesel which means costs are mounting and squeezing companies as they have to use cash holdings at a time when liquidity is tight in the economy,” Karoro said.
Dr. Chitambara also highlighted the long-term economic risks posed by the energy crisis.
“If the power supply issue is not resolved, we could see a significant de-industrialisation of the economy. This would not only lead to job losses but also undermine the country’s capacity to generate revenue, thus worsening the already precarious fiscal position,” he added.
However, Karoro also acknowledged that some of their members are not affected as they are on ringfenced power.
“We are an organisation that represents all categories of companies from the smallest SME to the big corporates, so, some of our members are not being affected as they work with ringfenced power from the local utility or from direct imports,” said.
Bongani Ndlovu