Zesa told to harden blow on debtors

By Staff reporter | 21 Apr 2020 at 19:06hrs
THE Government has instructed Zesa Holdings to come hard on defaulters in its efforts to recover its outstanding debt, which has ballooned to more than $1 billion.

Power and Energy Development Minister Advocate Fortune Chasi said the ministry has instructed Zesa to use aggressive means to recover money from defaulting customers.

"We (consumers) must clear our debts and I have asked Zesa to be a bit more zealous in terms of recovering their debts. Due to the ups and downs of the exchange rate as a result of our macro-economic situation, it just makes it very difficult for them (Zesa) to be viable," he said.
Adv Chasi could not be drawn to spell out the drastic measures Zesa would employ to recover its outstanding debts.

However, last year, Zesa's subsidiary, the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) placed a notice that it would start disconnecting power to defaulting customers in a bid to collect about $1,28 billion debt owed by consumers.

The power disconnection exercise primarily targeted customers in the commercial sector such as hotels, supermarkets, bakeries, shops and restaurants, among others. Said Adv Chasi: "People should make payment plans with Zesa or simply offset their outstanding debts because if they default for long it will just make life difficult for us all, so we are going to be a bit harsh. We have to work ourselves out of this situation and come up with a viable power utility."

He said non-payment of outstanding bills by consumers was severely crippling the power utility's operations.

"Right now people are enjoying undisrupted power supplies but they need to understand that for us to be in this state of stability, Zesa must be liquid to import more power, including increasing its fleet of vehicles to enable it to attend to faults on time because as it is, it is incapacitated and what is disappointing is our attitude towards that particular matter (offsetting debts)," said Adv Chasi.

He reiterated that the delay in payment of bills was hampering Zesa's efforts to make prompt payments for importation of power from neighbouring countries. Zimbabwe imports power from Eskom in South Africa and Mozambique's Hydro Cahora Bassa (HCB) and Electricidade de Mocambique (EDM). Last month, the country liquidated its US$33 million debt it owed to Eskom but it is still to settle the US$45 million debt owed to Mozambique.

"When it comes to offsetting our power importation debt, we are looking at two issues where we are supposed to pay off HCB and EDM of Mozambique and we are making those efforts. We are already engaged in negotiations with a view of paying them as well as coming with a position on how much power we can get from them. We are working on building our foreign currency reserves and improving our coffers so that we pay out while we are also negotiating with them (Mozambique power utilities), so as to give them confidence and show that we are serious. We have got to redeem ourselves," said Adv Chasi.

He also said the country was working on renewing the power trilateral agreement it had with South Africa and Mozambique.

"There used to be trilateral agreement between Zimbabwe-Mozambique and South Africa, which for some reason was allowed to expire. So, we are making efforts to try and revisit that agreement because it assists us from a pricing point of view and availability of power," said Adv Chasi.

The 30-year trilateral agreement signed by the three neighbouring countries in 1990 allowed Zimbabwe to negotiate for "firm and competitively priced" electricity from HCB and Eskom.



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