ZESCO Limited has justified the proposed increase in electricity tariffs.
Speaking during the Energy Regulation Board (ERB) ZESCO tariff review public hearing in Lusaka today, Acting Managing Director Bestty Phiri says the primary driver for the Tariff Application is the need for investment in new electricity infrastructure, Inflation leading to rising operating costs and the Exchange rate fluctuations.
Mr Phiri states that the consequences of not having tariff adjustment will include perpetual load shedding, higher energy costs to the entire economy, insufficient capacity to support accelerated growth in the economy, under investment in the sector among others.
And making submissions, Zambia Association of Manufacturers (ZAM) Chief Executive Officer Maybin Nsupila advised ZESCO to consider adjusting the proposed tariffs in a phased manner.
He says if Zesco will not consider adjusting the tariffs gradually, the country’s manufacturing industry will collapse with the proposed increase.
Mr. Nsupila says ZESCO should establish the targeted tariff level for 2019, workout the needed annual increments and share them with consumers for consensus and enable them plan.
He adds that ERB should ensure ZESCO signs service level agreements with its clients particularly commercial and maximum demand clients, adding that other reforms aimed at improving efficiencies within ZESCO and reducing the administrative cost of service as well as improve service delivery need to be implemented over the migration process.
And Zambia National Farmers Union senior economist Humphrey Katontonka says while the Union supports the need to increase tariffs in principle; the proposed increments by ZESCO are just too high to be implemented at once.
Mr. Katontoka says ZESCO’s proposed 244% increment is far too high for farmers to remain viable.
He suggested that the tariff increment be phased into 4 equal increments over a period of two (2) years in order to allow commodity prices to catch up and give farmers a chance to prepare.
And the Energy Regulation Board (ERB) ERB Executive Director Langiwe Zulu says the performance of ZESCO will be considered in arriving at the final tariff award.
Its a waste of time, the tariff will still be increased anyway. The cabinet already made the decision in a statement read by Vincent Mwale. All the submissions made are just for the records.
How does a normal quasi govt institution propose to increase tariffs by 224% in one sitting? It is a sign that the govt in power has lost direction, now you want to completely kill off agriculture, while you sing of diversification. Surely we have a priest at the helm of Ministry of Energy and….
This is a purely academic exercise!
Very soon Zesco will not have any electricity to sell anyway.
If Sata and his PF had not been so greedy to steal, they would have seen that POWER is the critical need for Zambias economy, not ROADS. But road contracts can be hidden under the mattress, unlike hydroelectric dams.
We are still waiting to start on Batoka Gorge, which will solve all our power problems up to 2030. So can we now SELL the roads and use the proceeds to pay for the dam? Nobody will give us another EUROBOND, and we have to start paying that back now.
Batoka dam is a white elephant and will never produce very much power, at the moment vic falls is nearly dry, you will be lucky to get it to work 5 months a year and of course the dam will destroy the tourism sector. ie white water rafting, which is one of the main draw cards to the falls. Plus Zambia must share the power with Zimbabwe.
ERB has heard and Zesco has to confirm more with regulator Its unlikely if the increase especially with OECD downgrade of world economic outlook to 2.6% in view of Chinas commodity drive economy impacting heavily on Africa and in particular Zambia
ERB has competent economists ,they cannot increase the tariff over the inflation rate to velocity further inflationary pressure on cost of those produce
Its was a good hearing and Lusaka Times is accurate and true I made the presentation but Its Lusaka times is invissible
We only hope the act ERB is changed to allow for review of written responses from Zesco at the Second available hearing at which the regulator ERB makes a Final review and ruling to ensure all views are responded to and captured
Zesco I know should be open as they did and provide to ensure acceptable bought in tariffs and ensure clients supports
It will not be though wise in the year of the coming of the king to increase tariffs”‘
It is way too much. They shouldn’t increase the prices, it is far too early.