Zimbabwe's power sector requires $8 billion

By Staff reporter | 18 Mar 2019 at 09:44hrs
At least US$8 billion is required to rehabilitate Zimbabwe's dilapidated energy infrastructure which has been described as a major impediment to development.

 Energy and Power Development deputy Minister, Magma Mudyiwa, told delegates attending the Zimbabwe Infrastructure Summit in the capital last Thursday that the increasingly rundown energy infrastructure has resulted in investors shunning the country. Power is Zimbabwe's infrastructure weak point and the country is grappling with a huge supply deficit due to poor local electricity generation.

"With the cost of addressing the power infrastructure supply needs of Zimbabwe being estimated at US$8 billion, the government cannot foot the bill alone," Mudyiwa said.

"Therefore a clarion call for private sector participation is fundamental. We are open to all models of funding such as Public Private Partnerships and the Build Operate and Transfer model. These models have been analysed to have far greater advantages than disadvantages for us developing nations and thus the new language of the day. However, if not properly managed though, they may lead to disastrous consequences, hence proper policies need to be in place," she said.

Mudyiwa disclosed that government was crafting a new policy for independent power producers (IPPs) to tighten screws and force licence holders to implement projects.

The majority of the over 20 registered IPPs have over the years failed to get their proposed projects off the ground, years after they were licences to construct electricity power stations.

"My ministry is aware of the need to level the playing field if all are to competitively and sustainably take part in the sector," Mudyiwa said.

"My ministry launched the National Energy Policy (NEP) in 2012 to provide the necessary incentives, guidelines and direction for development of the sector. In addition, my ministry is working on several other supporting policies and plans that are at various stages of development to complement the NEP. These include the independent power producer policy," she added.

ZimFund manager, Emmanuel Nzabanita, said in order for the sector to attract private investors, it must be efficient.

"The energy sector in Zimbabwe lacks finance and proper policies for it to grow,"Nzabanita said.

"If the Zimbabwe energy sector want to attract the private sector, the sector must be efficient. If not efficient, like now, Zimbabweans are going to bear the costs. The country has huge resources and all what is needed is to tap into this," he added.



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