Expensive power plants drive up tariffs: Chitando

Expensive power plants drive up  tariffs: Chitando
Minister of Mines, Winston Chitando

Minister of Mines, Winston Chitando

ZIMBABWE’s Mines Minister, Winston Chitando, last week said the high costs of running local power plants had a bearing on the country’s energy tariffs.
Speaking at the Zimbabwe Trade and Investment Conference Expo in Harare, Chitando said power tariffs in Zimbabwe were high because some local plants that feed into the grid were expensive to run. He said the country was restrained from supplementing power supply with imports due to foreign currency shortages.
“The country’s power generation is outweighed by its demand and the gap is covered by imports which drain foreign currency. In trying to minimise on these imports, what has been happening is that we end up using some local power plants which are expensive to run, notably Harare, Bulawayo and Munyati,” said Chitando.  
The country’s power tariff, at 9,86 cents per kilowatt-hour (kWh), is among the highest in the region as most countries charge below eight cents per kWh. According to a Southern African Power Pool report, only three countries in the region have higher tariffs. Swaziland and Tanzania’s electricity tariffs are between 10 and 11 cents per kWh while the average tariff in Namibia is above 16 cents per kWh.  
Chitando said government was aware of the fact that electricity was expensive in the country. He said the extension of the Kariba and Hwange plants were an effort to improve the situation.
“It is a fact that tariffs are high, but it is something government is working on. Projects are currently underway to correct the situation. The Kariba plant is being extended, the same with Hwange; these projects will help bring down the costs of power generation in the country,” he said.
The Kariba hydro power station extension is expected to add 300 megawatts of capacity at the plant, which is the most economical in the country, running at an average cost of two cents per kWh.
The other major plants in Zimbabwe are thermally powered and cost between six and eight cents per kWh to run.
Work on the Hwange power plant extension, to last 42 months, is expected to add capacity of 600 megawatts. The project’s estimated cost is $1,5 billion.    
The country’s main power distributor, the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) has been pushing for a review of the power tariff to 11 cents per kWh. The parastatal says the current tariff is causing it to make losses.
The Zimbabwe Energy Regulatory Authority is reportedly considering a tariff review application from ZETDC.  

  • okaMthwakazi

    Mr Chitando,

    Our power is “expensive” because it is not subsidized. The region you are comparing with has heavily govt-subsidized tariffs. Our gvt does not have the money to do that. A certain rich country in southern africa is failing to pay fuel suppliers their subsidies right now. But when we compare, we say their fuel is cheaper. Would you rather be a fuel supplier where your subsidies will come late and impact your business negatively?No one is talking about the source of the high costs, namely Hwange Colliery’s inability to supply high-grade coal to ZPC and its failure to produce consistent quantities. Address issues at the source comrade, not down the value chain.

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