'Zesa new tariffs comparative to the region'

By Staff reporter | 04 Nov 2019 at 07:59hrs
New electricity tariffs, which are considered punitive by consumers, are "comparative" to charges levied to consumers elsewhere in the region, the Zimbabwe Energy Regulatory Authority (Zera) has said.

But say low disposable incomes make the charges steeper for them.

The regulatory body also believes the new charges make it possible to finance imports, which are presently chewing up US$15 million per month.

Under the steeped domestic tariff system that became effective on October 4, domestic consumers can buy up to 50 kilowatt hours (kWh) at 41c per kWh, or per unit.

The charges rise to 9c for those using between 51kWh and 200kWh.

And users purchasing more than 200kWh will be paying $3,87 per unit after exceeding the 200kWh.

However, lower-priced tranches can only be bought once a calendar month and must be bought at the same time.

"When we did the tariff approval, they were comparative with the region, where our own is at US10,68 cents per kWh whilst Namibia it is around US17cents per kWh," he said.

Data from the World Bank indicates that Zimbabwe had the second-lowest tariff in Sub-Saharan Africa in 2017.

On the higher end of the scale, Liberia — the most expensive — charges US50c per kWh.

Cape Verde levies US45c per unit.

Consumers are, however, fretting that the new tariffs are anti-poor as they are not sensitive to low-paid workers who cannot afford to pay for the low-priced tranche at once.

Consumer Council of Zimbabwe (CCZ) executive director Rosemary Siyachitema said the new tariff system has become a burden to cash-strapped citizens.

"The new system that was introduced by Zesa is really expensive for people whose salaries have not been increased and now they cannot even buy electricity," she said.

While sympathising with consumers, Zesa, however, maintains there is need for cost-reflective tariffs to support the power utility's imports.

"The thrust for the business is to attain cost-reflective tariffs as electricity is being imported at a great cost to the nation at about US$15 million.

"The tariffs speak to energy conservation by rewarding efficient users and applying the actual costs to heavy users," said Zesa Holdings spokesperson Mr Fullard Gwasira.

"Our promise to customers is that in the medium term our quality of services is going to improve greatly as the money will be used to buy replacement transformers, cables and operational vehicles.

"The vending system will be reinforced and we will be able to respond to faults quicker and have material in stock.

"Load shedding will eventually be eliminated as we will be having new plants whilst at the same time we are able to import power."

SADC adopted the principle of cost-reflective tariffs in 2004.

However, most countries are failing to migrate to cost-reflective tariffs due to challenges in raising local tariffs to cushion consumers.

A recent survey conducted by Regional Electricity Regulators Association of Southern Africa showed that the region's energy sector is not self-sustaining.

Such trends were thought to be discouraging investment in the region.



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