. . . utility secures $81m loan facility

Business Reporter

ZESA Holdings has secured $81 million from a local financial institution for the procurement of spares for power stations and stabilisation of the national grid, sources have said. “The deal was signed last week and zesa can start drawing down on the facility,” said one source who requested not to be named.“It’s a loan facility arranged by a local bank.”

No official comment could be obtained from zesa by the time of going to print.

zesa, through its subsidiary, the Zimbabwe Power Company operates five power stations.

The power utility has been working on projects aimed at expanding electricity generation to bridge the gap between supply and demand. These include expansion of Kariba, Hwange Thermal Power Station and rehabilitation of small thermal stations.

zesa is also working on upgrading the national transmission system as a lot of cables are now old.

In April, zesa completed the refurbishment of its power evacuation system at Kariba Power Station at a cost of about $14 million. zesa Holdings, through its transmission subsidiary ZETDC contracted Helcraw, a local firm, to undertake the project.

The project, funded by Afrochin, involved replacement of old cables and the associated equipment to increase off-take of electricity from the power station and to make the asset insurable as well as to eliminate the risk of fire to the equipment.

zesa Holdings intends to build a new electricity distribution line linking Mutare and Triangle at a cost of about $150 million and has already invited bids from companies interested to undertake the project.

To be known as Orange Groove-Triangle, the tender for the 300 kilometre 400kV line will enhance reliability and efficiency of the electricity transmission system. zesa will also spend $14 million to upgrade Alaska-Karoi line.

zesa, which is owed about $1,1 billion by consumers has been struggling to raise funds for capital projects. The power utility has since increased recovery rate to 50 percent from 40 percent of electricity purchases on consumers with pre-paid metres.

This means zesa will take 50percent of every purchase to offset debts accumulated under the old conventional billing system.