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    ZETDC struggles to pay regional power suppliers

    March 20, 2023 - Business Weekly


      The Zimbabwe Electricity Transmission and Distribution Company (ZETDC), says overall debt to regional power firms has bulked to over US$100 million due to persistent foreign currency shortages.

      As a result of constrained power generation capacity, ZESA is importing significant mount of power from Mozambique, Zambia and South Africa.

      ZETDC Commercial service director, Engineer Gift Ndlovu, said shortages of foreign currency has been the biggest challenge for the power utility, not only affecting imports, but generational capacity.

      'Last week we received a letter from ZESCO that we will be switched off due to non-payment of US$10,7 million debt for the months of February and March 2023.

      'Overall, our regional debts are now over US$100 million and this is among the other reasons we are adopting USD tariffs as we seek to generate more foreign currency,' he said during a virtual engagement with the Confederation of Zimbabwe Industries (CZI).

      Zimbabwe is currently getting imports from ZESCO, ESKOM and HCB Mozambique and at the same time has an obligation to send 80MW to Nampower.

      The country's power generation has been largely affected by decades of non-maintenance and aged infrastructure, which has seen thermal units in Bulawayo, Harare and Munyati's power generation being curtailed while Hwange and Kariba are operating below capacity.

      According to Ndlovu, 80 percent of electricity supply infrastructure requires overhaul as it is now a liability.

      Recently while addressing journalists in Hwange, ZESA chairman Dr Sydney Gata, said the obsoletely equipped power stations were now operating due to the ingenuity of local engineers.

      Said Ndlovu: 'They are now giving us challenges and liabilities now compromise the effectiveness of the grid.

      'We need to overhaul it to improve the integrity so that we can at least get to a better level that is acceptable.

      'We have had decades of grid non-maintenance owing to the sub economic tariff that we have had for the past decade,' he said.

      He said ZETDC is also deploying significant capital on fighting vandalism. According to ZETDC, total power supply from generation and imports ranges from 1000 MW to 1350 MW against the economy's demand that ranges between 1500 MW to 1700 MW.

      Ndlovu said the long term plan is on new hydro power projects along the Zambezi River and renewable energy projects.

      'As a result of foreign currency shortages, ZETDC is set to adopt a 100 percent payment of electricity in USD terms in order to fund imports, new projects and fight vandalism,' he said.

      However, Ndlovu said in the short to medium term power supply is bright because there has been an increase in dam water level at Kariba and hope by May or June this year, Kariba will be producing around 450MW.

      'The main hope is the completion of Hwange unit 7 and 8 with one unit expected to come on stream by the end of this month and the other before end of the year,' he said.

      According to Ndlovu, Hwange has not been doing well in terms of capacity while Kariba was affected by low water levels.

      However, he said at Kariba, there has been encouragement, with the water level improving from 0,66 percent as of January this year to 16,57 percent and the power station generation has improved from 250MW to about 350MW.

      According to the Confederation of Zimbabwe Industries (CZI), the power supply situation in the country remains erratic to a level where some consumers are experiencing an average of 10-12 power cuts daily while others go for days without power and before faults are resolved.

      The situation according to CZI has significantly affected business cash flows, threatened business viability and competitiveness of the local products at a time imports are gaining foothold in the local market due to dollarisation.


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