Godfrey Marawanyika/Gift Phiri
THE Zimbabwe Electricity Supply Authority (Zesa) has reduced its debt to Eskom of South Africa from US$30 million in April to US$11,16 million by the end of last month.
The debt, which has been accruing over the past four years, was for electricity imports.
The power utility’s arrears have over the past months been declining due to substantial payments using foreign currency allocations from the Reserve Bank.
Zesa imports 35% of its electricity requirements from Zambia, South Africa, Mozambique and the Democratic Republic of Congo.
Zesa general manager for corporate affairs Obert Nyatanga this week confirmed that their debt had declined.
“We are hoping to clear the debt by the end of this year, with the support we are getting from the Reserve Bank of Zimbabwe. I am optimistic that we should be have paid the debt in full by the end of this year,” he said.
“The Reserve Bank has been giving us US$12 million every month to pay our debts and the other money is used for the prepayment facility for our electricity imports.”
Half of the US$12 million facility is used to settle debts to regional power supplies and the procurement of spares.
The other half is used for prepayment for electricity imports.
The prepayment requirement was imposed on Zesa by Eskom and other suppliers because of its failure to settle debts on time.
This resulted in Zesa being classified as an interruptible customer, meaning its supplies could be cut without, or at short notice.
This year, HCB of Mozambique reduced its exports to Zimbabwe from 400MW to 250 MW largely due to non-payment.
Currently, all imports from HCB, Eskom and Snel of the Democratic Republic of Congo have to be paid for in advance.
The prepayment arrangement for current and future imports covers a portion to service the old debt.
Over the past four years, Zimbabwe has been facing its most severe political and economic crisis since Independence in 1980, marked by acute shortages of foreign currency and fuel.
The crisis resulted in country’s foreign currency coffers declining to very low levels, and at one stage the central bank was left with forex cover of less than a month.
The reduction of debt by Zesa comes as some relief as Eskom was understood to be seeking equity in Hwange power station or Kariba hydro station to offset the debt.
Meanwhile this week Zesa floated $30 billion Megawatt Bills which were undersubscribed.
The bills were issued on Tuesday and by Wednesday, Genesis Investment Bank, the lead financial advisors, had allotted $9,5 billion.
Eskom spokesperson Fani Zulu this week said speculation about them taking equity in Zesa was not true.
He also said that although Zesa’s debt had been declining, as a matter of policy they did not discuss their clients’ details in public.