Zesa to sign $42 million facility
POWER utility, Zesa Holdings is set to sign a $42 million facility with local companies, including ferrochrome and platinum producers to pay for power imports upfront.
The measures are part of efforts Zesa is putting in place to ensure adequate financial resources to pay for imports. Zimbabwe generates an average 1 100 megawatts, against peak demand of 1 400MW and imports power from South Africa and Mozambique’s Cahora Bassa hydroelectric power company to cover for the shortfall.
“The facility will ensure that Zesa Holdings will be able to import power on prepayment basis for the next 12 months,” said one source who requested not to be named.
The state-owned company spends about $5 million per week to import power, funded by the Reserve Bank of Zimbabwe and Zesa’s own resources. Sources said Zesa has already reached an agreement with chrome smelters and was now finalising a deal with platinum miners.
Zesa has also met the Confederation of Zimbabwe Industries over the same arrangement.
In terms of the deal, Zesa will guarantee to provide uninterrupted supply of power to the miners during the period of the agreement, subject to emergencies outside of its control.
With the ongoing electricity expansion projects, Zimbabwe will be able to sufficiently produce power for domestic consumption and export excess power by 2018.
The first phase of Zesa’s expansion to the 750MW existing capacity is expected to come on line in 2017 and the next phase would start feeding the power grid sometime in 2018.
The Government, through Zesa, has also contracted $1,4 billion Sino Hydro of China, which is also doing the Kariba expansion, for the 600MW extension of Hwange Power Station.
Several other public and private power projects underway across the country, which include the Lupane coal bed methane gas initiative, the Batoka Gorge hydro power project, a joint programme with Zambian power utility, Zesco and 660MW power plant by Makomo Resources, the country largest coal miner in terms of production. at the International Monetary Fund after Lagarde’s predecessor Dominique Strauss Khan resigned in 2011 over a sex assault scandal.
The Washington-based institution’s executive board was expected to meet shortly to consider the implications of the verdict, IMF spokesman Gerry Rice said. — Reuters