Energy Minister David Mabumba has charged that in the year 2017, electricity tariffs would be revised in order to make them cost reflective in line with the policy shifts as outlined in the National Budget.
Speaking during a press briefing in his office yesterday, Mr Mabumba appealed to Zambians to bear with the government that as the nation was going through power deficit, government in 2017 would be working on developing the hydro, solar, coal and geothermal potential.
Mr Mabumba said currently the power tariffs in Zambia were not economically attractive.
“…and as long as we don’t deal with structures of our tariffs in this country, it would be difficult for Zambia to attract the private sector,” Mr Mabumba said.
Mr Mabumba said in order for government to finance a K3.5 billion dollar Bakota power project, it needed to have cost reflective tariffs.
He said if the tariffs were not attractive, the banks would not be willing to finance the energy projects.
Mr Mabumba said government was spending about US$40 million dollars per month from electricity imported from Zimbabwe, an equivalent of almost U$480 million per year.
He said Zambia had been importing 300 megawatts per day from Mozambique.
Meanwhile, Mr Mabumba said government would implement the policy shift of delinking itself from the oil procurement process and leave the procurement of petroleum products to the private sector.
On fuel prices, Mr Mabumba said despite the policy shift of delinking itself from oil procurement, the Energy Regulations Board would continue to determine the oil pump price.
“Governments in the SADC region even in East Africa do not participate in the procurement of fuel because they have realized that the private sectors are the drivers of job creation and they have decided to empower the private sector to import fuel on behalf of their respective government,” Mr Mambumba said.
Mr Mabumba said in 2017 government would begin a gradual process to build capacity in the private sector to participate in the procurement of petroleum product in the country.
He said the Ministry of Energy would only be providing policy directions and regulations by creating an enabling environment for all the OMCs to have equal participation.
Mr Mabumba said the government through the Energy Regulations Board would still return the uniform pump price across the country in order to protect the Zambian people.
He however stated that in the oil procurement process, government would have to protect the interest of Indeni and TAZAMA oil pipelines.