Power tariff review comes after investigations: Minister

Senior Business Reporter
ENERGY and Power Development Minister Dzikamai Mavhaire says a power tariff review will only be made after thorough investigations on production costs are concluded. The Zimbabwe Electricity Transmission and Distribution Company (ZETDC) has applied to the Zimbabwe Energy Regulatory Authority to increase power tariffs from 9,86c/kWh to 10,36c/kWh based on the prescribed Rate of Return tariff methodology and ZETDC approved Revenue and Expenditure Budget of $890,596 million for 2014.

“Enough investigations on power production cost have to be made before coming up with a new tariff regime so we’re in the process of carrying out the investigations,” he said in an interview last week.

He said the country’s electricity tariffs were the cheapest compared to regional countries such as South Africa, Zambia, Namibia and Mozambique.

Minister Mavhaire said this was because the country had a hydro power station — Kariba.
“Had it been that all of our electricity generation was coming from thermal power stations, the tariffs were going to be expensive.”
Last month, Zera chief executive officer Engineer Gloria Magombo said the authority had compiled a report on the proposed electricity tariffs review as required by law.

She expressed optimism that a formal announcement would have been made by Minister Mavhaire before the beginning of this month.
Asked about what was contained in the report compiled by Zera, Minister Mavhaire refused to divulge the details.
“I can’t talk what is in my kitchen,” he said.

As part of efforts to improve power generation in the country, the government recently licenced 15 independent power producers whose projects are at different stages of development.

The government has also embarked on solar and biogas initiatives as well as engaged a Chinese firm, Sino Hydro for the expansion of the $355 million Kariba South Power Plant project expected to boost the station’s capacity to 1,050 megawatts. Kariba Hydro Power Station has an installed capacity of 750MW.

The government has announced that it has secured funding for the project following the recent signing of a $319 million deal with the Export Import Bank of China and Zimbabwe is expected to contribute 10 percent of the total cost of the expansion exercise.

At the moment, Zimbabwe is producing less than 1,200 megawatts against an installed capacity of 2,200MW.