Zambia follows Zimbabwe into the dark

Zambia power utility company Zesco has announced that it will effect a 200 percent tariff hike with effect from 1 October in line with shortfalls in local power generation and the need to cushion supplies through imports.

As in Zimbabwe, Zambia has failed to match power supply after water levels at a shared dam source fell to below viable levels from purposes of electricity production. The Southern Africa region has been hard hit by a severe drought which saw dam water levels at Kariba fall to below 23% from a high of over 80% at peak levels.

Zimbabwe which is undergoing a severe power shortage stretching for 16 hrs a day, shares the Kariba Dam, which has been hit by drought, together with Zambia as neighbours to the North. Zambia operates the Kariba North Power plant to the North while Zimbabwe operates the Kariba South plant on the South end.

The price increment according to ZESCO has been necessitated by the finalization of the importation of electricity from Eskom Of South Africa.

Addressing the media in Lusaka on Tuesday, an official with the utility said that the tariff hike will vary for individual costs depending on spending brackets.

He said the importation of power from South Africa would mean available power in the country would increase by 300 megawatts.

The hike will only be for six months of the power importation aimed at mitigating load shedding following a decline in generation resulting into a deficit of 700 megawatts necessitated by low water levels.

The current total power generated by both ZESCO and Independent Power Producers is around 1500 MW against a demand of 1900 MW during off peak and over 2500 MW during peak periods.

Kariba South which is the Zimbabwe end produces 1050 MW after the upgrade in late in 2018. Hwange could potentially produce 700 MW on addition of unit 7 and while present production is below 400 MW.

Zimbabwe is similarly importing power from SA at nearly similar rates of between 300 to 400 MW. It has however not improved the supplies as Hwange which is a thermal facility and complimentary supplier has broken down frequently resulting in sustained shortages.

Added together, the current production at Kariba, Hwange as well as the import component leave a huge shortfall of over 40% of Zimbabwe 1600 MW peak demand.

EQUITY AXIS NEWS

Respect Gwenzi

Respect is the Lead Analyst and Managing Director at Equity Axis. He has 8 years experience in respective fields of finance and media. Particular areas of expertise include Asset Management, Stockbroking and Financial Media. Respect is on a mission to change the course of Financial Media in Africa through digitalization

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