Commercial Farmers' Union of Zimbabwe

Commercial Farmers' Union of Zimbabwe

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End Zesa monopoly — Zerc

End Zesa monopoly — Zerc

By Business Writer
Tuesday, 07 February 2012 11:32

HARARE – Zimbabwe should licence independent power producers to end Zesa 
Holding’s dominance, Zimbabwe Energy Regulatory Authority (Zerc) chairman 
Canada Malunga says.

Malunga told a Parliamentary portfolio committee on mines and energy that 
competition would allow an improvement in utility services and meet the 
country’s growing electricity demands.

Zerc licensed five various independent power producers, but their combined 
production remains too low to influence the power sector.

“At the moment we have one large producer and transmitter (so) in as much as 
you may want to crack a huge whip it’s difficult,” Malunga said.

Operations at Zesa have continued to take a nose-dive with load shedding 
increasing whilst the company’s debtor’s book continues to balloon.

Zesa’s debtors’ book is currently in excess of $500 million, an equivalent 
of seven months of its total revenue according to Malunga.

Government institutions account for about $19 million of the debtors.

“What is worrying is that they are not able to collect that money,” he said.

“There are also leakages and one of the issues which we are fully backing is 
the issue of installing prepaid meters.”

He  said Zerc was willing to partner with the Zimbabwe Investment Authority 
in trying to secure investments in power generation.

However, international investors have also adopted a wait-and-see attitude 
on Zimbabwe given President Robert Mugabe’s persistent call for elections 
and the ongoing indigenisation exercise which compels all foreign owned 
firms to give at least 51 percent shareholding to Zimbabwean locals.

“Our intent is not to frustrate investors, we actually want to attract them” 
said Malunga, adding that there are always concerns of expropriation arising 
from the Indigenisation Act.

“Finance Minister (Tendai) Biti said in his budget there is need for policy 
stability and political stability. In the event that we put a new tariff, to 
what extent is it protected from being overturned.”

Malunga said there was need for assistance from the Finance ministry with 
respect to guaranteeing tax and other financial incentives.

The Confederation of Zimbabwe Industry has approached the courts seeking a 
review of Zesa’s 37 percent tariff hike in September last saying it was 

The industry body also argued Zesa has effected the new charges without 
consulting industry.


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