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Oliver Kazunga Senior Business Reporter
A RULING on a proposal by Zesa to increase power tariffs is expected to be announced at the end of the month, an official has said. The country’s power utility, Zesa, recently submitted an application to the Zimbabwe Energy Regulatory Authority (Zera) with the intent to increase electricity tariffs by five percent from $9,86 per kilowatt hour.
It said the present tariff charge falls short of the cost of running business, which it pegged at $10,51/kwh adding that it had in the past few years sought to revise tariffs upwards, but the government would not approve such increases or would reduce the percentages.
The power utility has said a marginal increase in the tariff would be detrimental to its operations in the long-term as it hopes the tariff hike request was meant to enable mobilisation of resources to fund plant and network maintenance backlog and correct distortions in the current tariff.
“Hopefully by the end of this month, the Minister of Energy and Power Development (Dzikamai Mavhaire) will make a formal announcement of the determination on the proposed power tariffs increase.
“So far, as the regulatory authority we’ve basically compiled a report on the proposed power tariff increase as required by law.
“The report is due for submission to the Minister of Energy and Power Development today (Friday last week),” said Zera chief executive officer, Engineer Gloria Magombo.
Zesa has justified the proposed hike, saying without a tariff increase to support the increasing input costs, the company might fail to generate electricity at current or improved levels, as some maintenance works might be compromised.
Meanwhile, Eng Magombo said the energy regulatory authority has licensed 15 Independent Power Producers (IPP) as the country moves towards addressing power challenges.
She said the projects were at various stages of development.
“Of the 15 IPP that we have licensed recently, six are mini hydro power stations that include Great Zimbabwe, Pungwe, and Nyaningura.
“Three of the six mini-hydro power projects are already operational and feeding to the national grid,” she said.
Securing a licence from Zera, she said, does not mean that the project will automatically take off overnight.
“There are a number of processes the investor has to go through before the project is operational. For example, before a licence is granted, the investor has to do a pre-feasibility study of the project and when the licence has been issued, the investor undertakes feasibility studies and due diligence,” said Eng Magombo.
Zimbabwe has a national demand of 2,200 megawatts but due to operational constraints facing Zesa, the country is producing about 1,200MW.
Online Reporter