Commercial Farmers' Union of Zimbabwe

Commercial Farmers' Union of Zimbabwe

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CZI set for showdown with Zesa

CZI set for showdown with Zesa

By Diana Chisvo, Business Writer
Wednesday, 31 August 2011 11:20

HARARE – The Confederation of Zimbabwe Industries (CZI) is preparing a 
lawsuit against Zesa Holdings in a bid to force the power company to reverse 
its tariff increase which it says has far reaching consequences on business 
and the economy.

Zesa, through its distribution company — the Zimbabwe Electricity 
Transmission and Distribution Company (ZETDC), has announced a 31 percent 
tariff increase at a time business and consumers are reeling from serious 
power cuts.

The blundering power giant said the increase will not reduce load-shedding 
but go towards rehabilitation of critical equipment which, in future, will 
improve power generation.

But the CZI yesterday came out with guns blazing, warning that their lawyers 
were preparing to fight the tariffs which it said are illegal.

“We wish to advise stakeholders that electricity tariff hikes distributed by 
the ZETDC are unsustainable, unjustified and illegal. The proposed tariff to 
be effected on 01 September 2011 results in a 53 percent aggregated 
increase. This shows lack of understanding or empathy with the nascent and 
fragile economic/industrial recovery
underway since 2009.”

“We are instructing our lawyers to take legal action to force ZETDC to 
rescind their illegal tariff hikes,” said CZI chief Joseph Kanyekanye. 
Kanyekanye said the increases have inflationary effects and might lead to 
loss of competitiveness for local businesses and will lead to price 
increases throughout the economy.

He dismissed reports that the increase was supported by industry and 
consumers saying that the electricity distributor has a technical committee 
with industry where the results have shown that the price hikes cannot be 
supported by ZETDC’s reflective tariff principle.

“We believe the ZETDC is not properly constituted and the apparent use of 
government officials as proxy for ZETDC is illegal and introduces the 
inefficiency in the regulation of tariffs. “There has not been any change in 
costs that warrant this increase in tariffs and CZI is asking the Ministry 
to appoint an independent regulator that will set aside the proposed illegal 

“We remain committed to working with the power utility at all times. We ask 
that the utility does some introspection with a view to reducing overheads 
arising from a top heavy structure an unsustainable wages and salaries,” 
Kanyekanye said.

Zimbabwe requires 2 000MW of power a day but the country currently produces 
only 1 300MW and gets 300MW from imports, leaving a deficit of 400MW.


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