Zesa broke, says new boss

said yesterday.
The power utility’s new group chief executive, Engineer Josh Chifamba told the Parliamentary Portfolio Committee on Parastatals and State Enterprises that Zesa has been bankrupt for a long time.
“We have a huge debt overhang of US$889 million. Technically speaking, we are insolvent because our current liabilities exceed our current assets,” Eng Chifamba told the committee, chaired by Zvishavane-Runde legislator, Cde Larry Mavima (Zanu-PF).
He said the company owed in excess of US$140 million to power utilities in the region.
Eng Chifamba said the company faced serious operational challenges owing to the unavailability of resources.
Other challenges included lack of skilled manpower in the requisite numbers and an antiquated transmission.
He said theft and vandalism of equipment were also major problems.
Government this year committed just US$55 million to power projects, an amount the Zesa boss described as “paltry”.
The company requires US$542 million for capital projects this year and was only capable of funding up to US$300 million using internal resources, Eng Chifamba said.
The Zesa boss bemoaned unavailability of long-term funding on the market, saying this could derail the parastatal’s plans.
Commercial and domestic electricity owe the utility US$480 million.
Eng Chifamba said this was affecting Zesa’s maintenance, expansion and foreign debt-servicing obligations.
Zesa this month secured a firm supply of 50 megawatts from the DRC and another 50MW will be availed later.
Eng Chifamba expressed optimism that Zesa would soon be out of the woods, despite presently under-supplying the nation by more than 800MW.
The country needs 2 100MW.
“We are confident that going forward we would be able to come out of the mess,” said the Zesa boss.
The plans include introduction of a pre-paid metering system as well as boosting productivity at Hwange Power Station by 600MW.
Eng Chifamba said there was need for serious investment by either government or independent power producers.
He defended the proposed 30 percent tariff hike – which Government suspended – saying it was “cost reflective”.
He said power production charges had gone up.
Eng Chifamba said they would further un-bundle the Zimbabwe Electricity Transmission and Distribution Company.
He said Government’s decision to un-bundle Zesa into four strategic business units over two years ago was paying dividends, pointing out that Powertel and Zesa Enterprises were profitable. – New Ziana.