By Ray Ndlovu | Business Day Live |
Power utility Eskom has said its northern neighbour, Zimbabwe, is under no compulsion to continue buying electricity from it, amid indications that Zimbabwe might struggle to keep up with tariffs.
Zimbabwe is spending $6.6m a month to buy electricity on a prepaid basis from Eskom.
The possibility of Zimbabwe pulling the plug on its power imports heightened after a 49% tariff hike sought early in 2016 by Zimbabwe’s power utility company, the Zimbabwe Electricity Supply Authority (Zesa), was rejected last week by the Zimbabwe Energy Regulatory Authority (Zera).
Zera chairwoman Ester Khosa said the electricity tariff would remain at 9.86 US cents per kilowatt hour for the remainder of 2016.
“In coming up with the decision to retain the current tariff levels, we considered the performance of the economy in 2014 and 2015, the government’s efforts to improve the ease of doing business, and to support the government in reducing the cost of doing business,” Khosa said.
Instead of the tariff hike, she said there was a need for Zimbabwe’s power utility to improve efficiency levels and to implement cost-cutting.
The hike, among other things, would have been used to pay for power imports and would also have assisted Zesa pay for some of its infrastructure capitalisation projects.
Zimbabwe imports power mainly from SA and Mozambique.
An Eskom official told Business Day that Zesa has an agreement with it to import power of up to 300MW, but this could be less, subject to the daily power demands experienced in the country.
Eskom spokesman Khulu Phasiwe said:
“For our side it’s not a big deal even if no country buys electricity. We won’t put a gun to their (Zesa) head; our first priority is the domestic market. We then sell to other nations in the Southern African power pool such as Namibia, Botswana and Tanzania.
“The sell of power to Zimbabwe is based on their demand, (and) where we only sell when we have excess capacity. So for as long as we have extra electricity, then we are in a position to sell.”
Zesa spokesman Fullard Gwasira said strain as a result of the tariff hike rejection was inevitable. Consumers in Zimbabwe owe Zesa arrears of up to $1bn.
This large debt has crippled power supplies in the country and negatively affected the productive capacity of Zimbabwe’s industries.
