Commercial Farmers' Union of Zimbabwe

Commercial Farmers' Union of Zimbabwe

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Minister wants Namibia power deal review

Minister wants Namibia power deal review

by Own Correspondent     Monday 14 February 2011

HARARE – Energy Minister Elton Mangoma says Zimbabwe is subsidising Namibian
power imports and wants terms of a 2008 barter deal between the two
countries reviewed in order to come up with a win-win scenario.

Mangoma said teams from the Zimbabwe Electricity Supply Authority (ZESA) and
Namibia’s NamPower were currently reviewing the barter deal under which the
Namibian power utility funded the rehabilitation of an ageing Zimbabwean
power station in exchange for subsidised electricity supply.

The review is meant to realign the tariffs that ZESA is charging NamPower to
market rates.

“We want the tariffs to be cost-effective and the matter is being handled at
utility level. If they fail to reach an agreement, the matter will be raised
at the ministerial level,” Mangoma told the latest edition of a weekly
newsletter published by Prime Minister Morgan Tsvangirai’s MDC-T party.

He said the Zimbabwe government position was that the tariffs should at
least meet the cost of producing electricity at Hwange.

“My position is that there is no way that Zimbabwe can subsidise Namibia as
far as power is concerned. Namibia should pay the actual cost at the very
minimum for the power they are getting,” said Mangoma, a member of
Tsvangirai’s MDC-T party which was not part of the Zimbabwean government
when the deal was agreed three years ago.

He did not say how much NamPower was currently paying for the electricity
and how much it costs to produce the power.

He said Zimbabwe was still grateful for the US$40 million provided by
NamPower for the refurbishment of Hwange Power Station and would continue to
honour its electricity supply obligation to Namibia.

“We continue to honour the obligation but we want it to be fair,” he added.

NamPower provided US$40 million for the refurbishment of Hwange Power
Station in Zimbabwe in 2008 in exchange for 150 megawatts of electricity
generated at the Zimbabwean plant until 2013.

This is the second time an MDC-T minister has questioned the terms of the
barter deal following a similar query by former energy minister Elias
Mudzuri two years ago.

Mudzuri even went on to threaten to cancel the transaction but later
retracted his statement following an outcry from Windhoek.

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


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