Zambia has raised the price of electricity for mining companies by 30 percent.
ZESCO and the Copperbelt Energy Corporation (CEC) have announced today in a move that will spike costs for the key sector in Africa’s leading copper producer.
CCEC and state-owned Zesco Ltd. said in a joint statement that the price hike would be backdated to take effect from January 2011.
The statement said the higher cost would provide the funding necessary to build new plants and invest in distribution infrastructure.
Frederick Bantubonse, the general manager of the Chamber of Mines of Zambia, an industry body which represents foreign mining companies said the higher cost of electricity would affect profitability.
Bantubonse said electricity is an important input for mining and any cost increase affects operations and profitability.
Neil Croucher, the managing director for operations at CEC told Reuters last month that the price increase would affect London-listed Vedanta Resources, Glencore International AG of Switzerland, Metorex of South Africa and Brazil’s Vale.
First Quantum has a separate agreement with Zesco and already pays more for power than the other miners.
Mining companies have been enjoying high copper prices on the international market with prices of the red metal hovering around US$9,000 since last year.
Reuters
Good News, we hope the government will use the extra revenue to provide electricity to all homes in Zambia.
They can afford to pay even more considering that they do not pay anything to GRZ due to corruption in zed. Wake up you people, especially those “nafuti nafuti” Rubish, RB included. RB is the worst president Zed will ever have. I dont know what is wrong wrong with people from the east. We need to learn from western province and make it a policy that each province should have a governor. Eastern can remain with RB for all i care!!
We have subsdised enough! long overdue! Who is Bantubonse?
This decision was made by Levy…lol
This is a joke. 30% of a low figure is not much. What ZESCO needs to do is to make these copper mines pay three times what they are currently paying and then top it up with a 30% increase.
#2, do you practice your tribalism openly or is this just a chat room thing?
at least four ignorant comments, especially the rubbish @4, who gave this tribal nincompoop access to internet? h.e. rupiah bwezani banda should be careful with the democracy and freedom that he has given, some people simply cannot handle it.
We know that RB wants money for campaigns. ZESCO has been directed t increase the tarrifs so as to meet the campaign budget.
Rubbish, if you have been following the news, you will realise that ZESCO, CEC and the mining companies have been negotiating a tariff adjustment for some time now. This 30% increase in the culmination of those negotiations.
But then, I wouldn’t expect an intelligent comment from a PF cadre would I?
Ba mambala Zesco & CEC this move is long over due. What have you been waiting for all along. Domestic customers have been paying more than the mines. You have come to relaise after some international NGOs blew off the lid on how the Mopani and other minening companies have been reaping off the country. Hammer them, Mr. Bantubonse should not talk of operational costs and profitability being affected. May be by paying more for power there will be some forex being kept in Bank Accounts for CEC and Zesco locally.
It is true! hammer them after all they complained about paying windfall tax.