The Zambia Electricity Supply Corporation (ZESCO) will lose over US$160 million as a result of the current power deficit the country is experiencing.
Chief Government Spokesperson Chishimba Kambwili says US$97 million revenue loss will be as a result of reduced sales to customers and an additional US$70 million revenue loss will be due to reduced sales to distribution customers.
Mr. Kambwili says the power utility firm will incur US$167 million revenue loss while US$60 million will be the cost of power imports between now and December this year.
He said the overall funding gap on reduced generation is pegged at US$116 million.
Mr. Kambwili, who is also Minister of Information and Broadcasting Services, disclosed this to the media in Lusaka today shortly after a Cabinet meeting held at State House.
The Minister said ZESCO Limited has been directed to revise the load-shedding programme from two to four hours on a daily basis adding that the programme will be implemented in an equitable manner to ensure that the burden is spread across all areas apart from essential services and operations.
He said short and long-term measures will be taken by ZESCO to alleviate the current power shortage as Cabinet has authorised the importation of 100 megawatts (mw) of power.
He said the power deficit may be cushioned when the 120mw Itezhi-Tezhi power station is commissioned as planned in August 2015 and when the 150mw Maamba Coal powered station is commissioned in November this year.
Mr. Kambwili said Cabinet has in the long-term also directed ZESCO to actively promote the use of renewable energy technologies and implement the Lusiwashi lower hydropower project in Serenje.
At the weekend, President Edgar Lungu toured the Kafue Gorge and Kariba North Bank power stations on a fact finding mission where he directed ZESCO to distribute electricity equitably in view of electricity blues due to the reduced water levels at two power plants.
The President learnt that the maximum power deficit Zambia faces is estimated at 560 megawatts.
ZESCO Limited has embarked on a countrywide power rationing mechanism in order to preserve the limited water available for power generation until the onset of the 2015 rain season.
In another development, Cabinet has also approved the opening of a Consulate-General in Guangzhou City in Guangdong Province in China as Zambia and China maintain diplomatic relations.
Mr. Kambwili said this has been done as the two countries explore the vast opportunities for trade, investment and tourism that the province of Guangdong offers.
And Cabinet has approved the implementation of the Revised National Tourism Policy, revised Sixth National Development Plan (R-SNDP), the revised Decentralisation Policy and the Job Creation and Industrialisation strategy.
Mr. Kambwili said Cabinet has also approved the appointment of a nine member board for the Zambia Centre for Accountancy Studies (ZCAS).
Coal is harmful to people and the environment
All this would have been avoid with proper planning. No one has taken responsibility for this or been brought to book and life goes on as usual in Zambia.
By the way we need State House to also bear part of the burden of the load shedding by having part of their power shut off. We need Kambwili to confirm that this has happened!!!
Lead by example and show us some of the solar panels State House has installed to inspire others not to rely on hydro electricity.
Otherwise it is all rhetoric as usual coming from government!!!!
ZESCO is useless. They should have had back up plans for the drought period.
Load shedding in the winter is stu.pid, people are getting poisoned and killed by carbon monoxide from using imbabula indoors.
Overall, Zambians can’t plan beyond 2 days!
@ Nubian Princess, Zambians CANT plan beyond 30 minutes that is why they cant deal with basics like be on time for meetings
Where does ZESCO take all this money? $255 million of the $750 EURO bond was given to ZESCO. We need our most trusted Auditor General to quickly move in and show us the thieves and politicians that like dipping their sticky fingers in ZESCO coffers.
Now you have PF (power failure )Cadres like Ndaje Khakis cheering, “ifintu ni Lungi”! Us we know ifintu nafilungula. Dollar is $8, petrol prices are going up. ZESCO is losing on revenue but up stream industry and service are losing 10times more. Effectively under Edgar Lungu, the Zambian economy has collapsed ( yagwa economy). PF govt have increased fees for all govt documents i.e road tax, drivers’ license. Where are we going? HH forewarned of ZESCO black out and PF came out guns blazing. Bane, ba Power Failure, inga mwafilwa, kuselapo!
Am not known as the real Olivia Pope for nothing. So let me break this down for you; PF just got their campaign money by load shedding. Campaign funds have been factored in for all those losses.
HH seriously get in touch with me and the next elections are yours. I don’t come cheap though.
Our friends in SA have built Jasper solar farm, located near Kimberley is now the continent’s largest solar power project. Construction was completed in October, and it is now fully operational as we speak. With a rated capacity of 96 megawatts, Jasper will produce about 180,000 megawatt-hours of clean energy annually for SA residents, enough to power up to 80,000 homes.
Meanwhile the empty tins in our govt are talking about useless long term plans when the answer is staring at them every time they open their sleepy hang over eyes in the morning.
Mmmm???? I don’t believe these numbers?? Don’t try to syphon Zesco cash in the name of Power shortage, to use during your campaigns next year?? Without Sata, Guy Scott and Wynter?? , PF have no money? I don’t believe these bustards, they are the biggest liars more than Chiluba that Zambians have ever seen.
This is why they have merged with MMD. No plan and busy consulting Dora on how they can steal. We are watching you closely and some of you will be jailed..
Since when would Kambwili come up with such statistics / Numbers? Zambians let us watch out…
I have come to the conclusion that politics is too serious a matter to be left to the politicians. ~Charles de Gaulle
WHAT A FAILED GOVERNMENT! ALL WE SEE IN ZAMBIA IS CONFUSION IN EVERY SECTOR OF OUR COUNTRY. LUNGU WILL BE REMEMBERED FOR CONFUSIONS HE HAS INTRODUCED IN OUR BELOVED NATION. COME 2016 WE NEED CHANGE!
About 90% of South Africa’s power comes from coal.
So that is how much ZESCO makes in the same timescale before the low waters, that is a lot of money, what have they being doing with it? Because any upgrades or repaires they are borrowing
Come on don’t you know? They subsidise PF.Even Judge Ngoma the cadre has an office at Zesco with a daily empty table full of newspapers. And this same Copperstone “degree holder only 3 months ago told the nation that since PF came to power loadsheding had ended.Even when it was widely reported that there was still loadsheding and it was to get worse.And voila Lungu now says let us not politicise loadsheding. As a country we are ****ed.
Munadya Eurobond. Mwaziona manje Tasila nadziko Chagwa Lungu.
This explains the logic behind this load shedding nonsense. This is the money they want to divert for next year’s elections in the name of importing power.
Why is it that only the PF (Power Fools) are seeing the reduced water levels when those of us who have been here since child hood can’t see it?
Mr Minister sir, us in Kitwe its 8 – 9 hours a day not the 2 or 4 hours you are mentioning. Surprisingly in Luanshya your area they even load shed on Sunday in the morning across the area where churches are during worship times.
Sometime back I suggested on this on-line tabloid that, we should consider digging a CANAL from the Indian Ocean into Zambia so that SHIPS and other vessels from all over the world could bring in katundu at our door step. Despite the labour and funds intensity this undertaking could gobble up, a long journey starts with one step.
I may not be there to witness completion of this massive project but my children, grand-children and indeed their children’s children will live to witness enormous wealth this project could bring. Further I had suggested that by going in to such a project, there would be no loafers, no kaponyas, nothing; everybody would be sacked in and will have a job. After many years when I have passed onto the other side of life, Zescoro will flourish because there will be…
When we cannot even dig one from the kafue (45km away) to provide water and sports/recreation to Lusaka
through foreign countries!
Just imagine, months later and no one has thought to implement your suggestion of building a canal for seagoing vessels to an elevation of 1,200 masl halfway across Africa. Go figure!
Incredibly, we don’t have high-speed (electric powered) bullet trains either.
…Plenty of water, finish….
But who told this bunch that there will enough water to generate more power by December? And why is no one not getting disciplined or punished for such poor management…for throwing over $160bn away (I guess it is more than that…just don’t believe a lying Gvt). Why shoul we protect/defend inefficient? This was predictable. And besides, measures should always be in place. I dread what would happen if there was a drought for 3 yrs in a row. Msge should loud and clear bat efficiency, please!
Sadly this is the price you pay for not mending the roof on a sunny day…you only borrow to eat…I told you so!!
Those who do not learn from advice MUST be made to learn from experience. Enjoy bena Zambia
I don’t feel sorry for zesco. They spend 60 – 65% of sales on employee costs. They need to reduce manpower cost to 40% as there is a lot of deadwood in zesco. They seek tariff rises not for infrastructure but blotted staff costs
UNDER THE CIRCUMSTANCES, REASONABLE LEADERS WOULD INTRODUCE COST SAVING MEASURES TO REDUCE GOVERNMENT EXPENDITURE. WITH OUR LEADERS THEY ARE OPENING MORE MISSIONS ABROAD TO WHICH TO SEND THEIR INCOMPETENT RELATIVES.
SADLY, ZAMBIANS CONTINUE TO VOTE FOR THEM. WHAT A NATION!
The Cost Volume Analysis in the loads with those rate shocks achieving the same revenues avoiding the rates shocks and those costs in exports
Next time do a water flow conditions not with drought projection of one year and take the best case on the Financials into your business plan managing your domestic load growth with other IPPs with a plus or minus on all planning scenarios in rates or exports imports over weighting appropriately with reasonable researched mines
The current excusive shows that our utility is poor in risk management and sensitivity analysis
The criticisms by ba UP and down are childish…..Can they create water if they were in power ?
Low Domestic Load Growth over Yrs.
High Domestic Load Growth overt Yrs.
Low import Load Growth over Yrs.
High import Load Growth overt Yrs.
Low export Load Growth over Yrs.
High export Load Growth overt Yrs.
Interest Rate shock UP in Basis Points Over the Yrs
Interest Rate Shock Down in Basis Points over the Yrs.
Low export price over the yrs
High Export prices over the yrs
Low import price over the yrs
High import prices over the yrs
Drought, water flow forecast over the yrs
As a result your capital needs Up in basis points over the yrs
As a result your capital needs Down in basis points over the yrs
Annualise the effect and see the planning horizon with impact and see the impact…
Annualise the effect and see the planning horizon with impact and see the impact depending on your basis point or sensitive to see your revenues expenses and assets plus liabilities and weight to position accordingly using the cost volume profitability module together with increament and opportunity cost approach
Its not a one year issue but over the planning period ba Dan That is why there is hydrology and Business planning to look at each others forecast
Its not business as usual From the above you can arrive at the financials and dictate generation Transmission and distributions and trading to export and import to achieve the same forecast ba Dan We understand ultilities
That is why you take reading every year on source and potential river sites to determine the hydro generation potential and factor those into the financials as generation set or in reserve as potential then during the year you do that Sometimes you use sate light and in the case of our Zescom you travel to sights and deep to determine that is where the lag is ba dan You determine the potential in water flow upfront even before the rains with Nasa weather stations which you can get not using old methods in measurements
Ba Dan and Zescom of Zambia its not a one year determination that is why its true to extend next year half way
Above Scenario can forecast Zesco Financials
Efyo ba Dan Mwila be pasha abantu or be paid to lie Its not right stick to the good life and things here ba Dan ba Zescom castle I am right
“ZESCO has been directed to revise load shedding from 2 hours to 4 hours…..” Where is this happening? Load shedding has been 8 hour stints. From 8 hrs to 14 hrs, or from 14 – 22hrs. Total of 8 hrs, which is a ridiculously long time to be without power. Fridges lose the chill!
Does Kambwili have facts?
That 8 hrs is a sensitivity analysis that is supposed to minimise the cost the minister has said there ba Dan but you can manage the loads and shed to achieve projected and still record some profits ba Dan
I am sure with what I have given you at 1 % basis points the scenario does not look good for Zesco and you can actually project over the Five yr. planning horizon
By like Energy minister has said before as comfirmed by Cheswa 84 Luanshya ,Zescom should have forecasted and the reason that its a one year outlook in rainfall pattern and contingencies is something thing that is sensitive and from my friend who said forecast or determination is not yearly is right
You can get the forecast on the above slot the numbers and see the implication on the Operational highly leveraged Zesco and see the increased stern on the operation line in that 198 Million USD
Ba Dan I stop here I forgave you and you are forgiven again but in future do not cheat for short-term gain You are forgiven
Thanks for the blessing in disguise you are just a used boy
Well … if there are low water levels, then even the Itezi-tezi dam wont be worth a damn!
#Bufi
#OneZambia
These are BIG numbers. They are chi dolla this and dolla that !! We not even talking rebased kwacha here, we talking big stuff.
Mr chikwanda, have you factored all this into the extra kaloba you are asking for. I don’t remember you factoring in load-shedding costs into your re-balancing of the budget ?? So isnt it appropriate for forward planning that the Govt looking for more Eurobonds albeit with a negative credit rating ??
Eurobond upon eurobond. Debt begets slavery. Bit by bit, the yoke is being tied around Zambian necks.
Worst of all, the Gov is only taking about the dolla losses Zesco is suffering. What about every factory, every household, every family, what are the economic losses to the country, not just your Zesco ??? Our charcoal bills are more than yr Zesco !!
Demand side management is also something that can be used to avoid load shedding Some industries should shift man hours to Late evening Image and leaving the pick when most power is used by commercial and medium scale to residential or vise versa domestic leaving industries during noon and day and evening time of use
Its working across and elsewhere we hope the meeting called to discuss the load shedding will look at the Demand side in managing
Its was also poor foresight to have dismantled old power plants in some diesel, in times like these these legacy power plants have proved a savvy elsewhere in the short term
Be progressive ba Dan we are energy…
Analysts
Consumers need to shift and operate at efficient times to avoid the “‘wet losses” in the demand and supply curves at peak times
ZAM should also encourage its members to work overnight and help manage the strain
Its only here in Zambia where every activity from domestic to industrial happens all at once With fewer number of industries shifting the demand in the load will yield maximum savings as opposed to other measures and reduce number of load shedding if you look at the Zesco time table and analyse the Zesco customer profile and tariff metering scenario for 2014 assuming 1% growth and leave close to 100 for exports rather than importing the same…
Then not every house needs security lights sensitive light powered by solar and all security lights switched off at premises and street lights allowed to be on only will help to save the much needed watts
If you are on the plane over Lusaka from Livingstone its a sorry sight each and every place and premises is littered with inefficient bulbs and quiet congested and the streets hardly identifiable
Switching off premises lights will add the savvy to the little rationed power also
The other solutions to energy load shedding at a fee I know you can not see afar and wide you only know the bulbs as savers ///
Like observed by maikalange there, commissioning of Itezhi Tezhi without it be in circle to Kafue gorge and the holding dam there will be a waste of water in generating a 120 MW of power using water that could have been better used down Kafue lower with concerns further down in Mozambique
If you learn financial modelling in hydro power plants and utilities simulation in Zesco ZESM EDM Escom ESKOM and Tannesco you will see the importance of Dams as holding facilities for hydro 90% driven like Zesco with Two intake in penstocks
Its becomes worse and a shut down scenario of Itezhi Tezhi Power Cop within Twenty Years is projected by Analysts in Sub Sahara Look out
Like observed by maikalange there, commissioning of Itezhi Tezhi without it be in circle to Kafue gorge and the holding dam there will be a waste of water in generating a 120 MW of power using water that could have been better used down Kafue lower with concerns further down in Mozambique
If you learn financial modelling in hydro power plants and utilities simulation in Zesco ZESA EDM Escom ESKOM and Tannesco you will see the importance of Dams as holding facilities for hydro 90% driven like Zesco with Two intake in penstocks
Its becomes worse and a shut down scenario of Itezhi Tezhi Power Cop within Twenty Years is projected by Analysts in Sub Sahara Look out
The problem is complex and goes beyond PF govt alone, it involves poor planning and political interference in zesco activities by successive governments. Zesco experts have been warning us about this for a good 10 years or more, everyone knows the grid needed extensive expansion to accomodate the exponential power demands, there was no proper allocation of resources for this, the wrong people were fired in zesco leadership and a lot of other bad decisions that compound one another. This propblem cannot be fixed overnight, it takes years to fix, its like building up a space programme or nuclear power plant, you dont just do it overnight.
Dat losses they r quoting was recovered at a double figure by exporting to oda countries…..for eg if a local has to buy units worth 50 kwacha in Zambia ,it would translate into 50dollars if they export….so ppl ,which one is more beneficial for zesco n government???????think my dear comrades
No business houses operate to make such huge losses….if they blame the rains I dontknw who is foolish to believe dat comment…..thing is zambians are very gullible…they believe whatever the government feeds them…..N forget easily n at a faster pace
Who cares about ZESCO loosing millions?
It is economy which has been forced on its knees by the institutionalized incompetence and lack of direction. Zesco is just a small chapter in the general state of continuous decay.
ZESCO wont loose anything – the consumer will as I can bet you now there will be an increase in electricity tariffs…first fuel prices go up making it unafordable to run our generators so we can carry on with business during load shedding and next they will increase zesco tariffs!!!!!!!!
A corporate institution does not depend on individuals Its a system If individuals where fired they did not take the data and information necessary to perpetuate Zesco
Its lack of understanding and exposure thinking that sensitivity analysis is only in the ERB multi tariff emphasising less other analysis
Imagine where was the auditor to give assurance to the shareholders and passed the accounts Lets recover the amount from him for not recognising this impairment on revenue and caused us enormous losses Lets recover from him and sue him for technical incompetency and failure to recognise this sensitivity analysis and ZICA should call for his review Passed wrong revenue
and failed to show the stakeholders who relied on his assurance that revenue line was solid an provided the trend analysis as seen from Zesco financials for 5 year period
Let us call him accountable as stake holders since he represents us and see what was his review on hydrology that when into the revenue computation He did not even mention that risk and potential in that to him it did not exist and therefore management also thought it normal
The auditor as custodian of stakeholders interest recover the 198USD in millions from him for giving wrong assurance on revenue line which has been expressively commented upon He cannot hide and give any excuse here The revenue
line is impaired here and you may need to consider some impairment revenue that sends wrong signals to assurances given by the auditor if it was Zescom,that is rated there could be some rating down grade
Hold the auditor to present his tests on the Generation set capacity and show us the test he made on revenue in generation potential for the audit review and Government relied on his assurance to commit and make decision including Zesco it self
Lets recover this impairment from the auditor for misleading us on the revenue lines without testing the hydro potential from Kaleni Hills
Sue the auditor???
It is laughable that people blame the PF government for the power outages. The problem at ZESCO is one of capacity. But we know the average time to build a power station is between 10 – 15 years. The PF was not in power when those investments should have been made. We must laud the PF however for investing part of the Eurobond in ZESCO. The benefits will be seen perhaps after 5 years.
The lead time in Dam construction has reduced to less than 3 years with proper mechanisation
Its not like the days of the Hanover DAM construction in the US
Check trends in infrastructural projects currently and best way of procuring packaging and construction The key is to get the correct guys not necessary the lowest who proves costly in capacity and make Below 5 yrs is acceptable UKUTULA amabye for any development in Zambia then you use machinery like in the mines to grid and dynamite or explosives for accessibility for safety well programmed and calculated
Money could be the limiting factor but five yrs is the best practice depending on the wattage
Its not like…
Does this man understand what he is reading, or as usual he was just told to read. He is only good at issuing threats to who ever he percieves as threat to his comfort. These guys will be answerable someday to God for all these things they are doing to Zambians. God is watching from heaven!!
Why is this brain dead dude talking of the losses ZESCO will incur in Dollars? What happened to the Kwacha?