HomeAnalysisZesa tariff hike timing ill-advised

Zesa tariff hike timing ill-advised

HARD-PRESSED Zimbabweans, flat broke and surviving hand to mouth, face a huge increase in electricity costs if cabinet endorses the Zimbabwe Energy Regulatory Authority-approved application for a tariff hike made by Zesa Holdings.

Candid Comment,Faith zaba

Zesa is proposing a 14% tariff increase from the current 9,86 cents to 11,2 cents per kilowatt per hour (kWh), which would make Zimbabwe’s energy the most expensive and least competitive in Sadc. Botswana and Mozambique charge 6c/kWh, while Zambia’s energy tariff is 7c, Swaziland 8c, South Africa 9c and Tanzania and Lesotho both charge 10c/kWh.

The power supply authority has for months been pushing for a tariff hike. Zesa Holdings, through the Zimbabwe Electricity Transmission and Distribution Company, had initially applied for a new tariff of 14,6c/kWh to help finance imports to mitigate the power shortages and expand generation capacity.

An inter-ministerial committee is currently seized with the matter and consumers can only hope that reason will prevail and the committee will reject the request, taking into consideration the harsh economic environment.

While it is understandable that Zesa needs the additional funding to import electricity, the timing is just wrong and insensitive because of the challenges Zimbabweans are facing. Zimbabwe is importing power mainly from South Africa (300 megawatts) and Mozambique (400MW).

The proposal could not have come at a worse time with the country experiencing a debilitating cash shortage, low capacity utilisation of 34,3% and massive job losses. It also comes at a time consumers are struggling to pay current electricity bills.

More than 90% of Zimbabwe’s employable population makes a living from the informal sector. As households prepare for the energy price hike, they also have to worry about day-to-day demands in a market where everything is so expensive, including rent and food.

What makes it worse are reports that Energy minister Samuel Undenge has hired his cronies to be public relations (PR) consultants, duplicating the roles of Zesa’s internal PR officers while bleeding the power utility of thousands of dollars This, if true, is scandalous and should result in the resignation or dismissal of the minister.

Besides, multi-million dollar tenders at Zesa have been given to dodgy characters with criminal records due to corruption.

Zesa must not ask its clients to subsidise corruption. This must be resisted.

Unemployment increased last year when a July 17 Supreme Court ruling, which allowed employers to dismiss workers on three months’ notice without paying a retrenchment package, resulted in thousands being rendered jobless.

The hike will further cripple industry, particularly the mining sector, which is already hard hit by falling prices of most minerals. The agricultural sector struggling from an El Nino-induced drought will also not be spared.

If the government is as people-oriented as it claims ad nauseam, it should reject the tariffs increase request and investigate those corrupt deals.

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