The Zimbabwe Independent

Struggling Zesa owed US$30m


THE country’s power utility Zesa is owed US$30 million by debtors that are billed in foreign currency, and ZW$3,2 billion by debtors that include government and local authoritie­s, a situation which Parliament has warned might end up in the electricit­y supply authority failing to pay for its imports next year.

e issue was revealed by the Parliament­ary Portfolio Committee on Energy in their report presented this week in the National Assembly by Elias Musakwa (Zanu PF, Bikita West) on the Finance Bill to do with the 2021 national budget.

Zesa’s highest debtors are local authoritie­s which owe it ZW$1 billion (about US$12 million), government which owes Zesa ZW$400 million (about US$5 million), and parastatal­s with another huge ZW$189 million (about US$2,3 million) debt.

“ e Energy Committee noted with concern that the amount owed to Zesa by various customers has been increasing and currently stands at ZW$3,2 billion for customers paying in local currency and US$30 million for those billed in foreign currency,” read the committee report.

“ e failure to pay by government and local authoritie­s has negative effects on the electricit­y generation company. e situation is worsened by that Zesa owes various suppliers about US$90 million and this debt needs to be serviced every month, but the current tariffs have no provision for debt servicing.

“ e debt was accrued due to delays in effecting tariff changes in line with macroecono­mic developmen­ts in the country,” they said.

Coupled with the problem of failure by debtors to settle their electricit­y debts, the committee said the power utility is also seized with problems of vandalism of electricit­y infrastruc­ture.

“Zesa informed the committee that cases of vandalism have increased in most areas in the country with about 200 cases of theft of electricit­y infrastruc­ture having been reported during the months of October and November 2020 only. is has affected the provision of transforme­rs for new connection­s, as the newly acquired transforme­rs will be allocated to areas that would have lost transforme­rs due to vandalism.

“It is therefore recommende­d that the 2021 budget should provide funding for enhancing security of electricit­y infrastruc­ture. In addition, there is also need for Zesa, with the assistance of Parliament, to carry out awareness campaigns to educate people on how they can police their areas and to have a sense of ownership for infrastruc­ture in their areas.”

A total of 787 cases of vandalism of electricit­y infrastruc­ture were said to have been reported in 2020, with most of the cases of theft recorded in the past two months.

e Energy Committee further expressed concern that while transforme­rs can be manufactur­ed locally by Zesa’s subsidiary company called ZENT, sadly Finance minister Mthuli Ncube failed to provide a budget for the production of transforme­rs in 2021.

ZENT is said to be currently in the process of procuring materials for the production of 830 transforme­rs, which Parliament says will go a long way in reducing the backlog to replace the vandalised or old transforme­rs.

e Energy Portfolio Committee report also said the supply of electricit­y in the country was under threat due to foreign currency shortages for the importatio­n of electricit­y and other equipment required for maintenanc­e of the power stations.

“During the greater part of 2020, the exchange rate was not stable. Most of the electricit­y users are paying using local currency. Zesa has also not provided an incentive mechanism to encourage the purchase of electricit­y in foreign currency. e Energy Committee recommends that Zesa should come up with an incentive tariff structure for customers paying in foreign currency.”

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