Copperbelt Energy Corporation (CEC) may be forced out of business as early as March 2020 if a new Bulk Supply Agreement with ZESCO is not signed, company Plc Chief Executive Officer Owen Silavwe has revealed.And some Ministry of Energy officials have said Zesco has been instructed not to renew the agreement by some “high ranking” government officials on suspicion that CEC funds the opposition UPND.
CEC is listed on the Lusaka Securities Exchange with majority shares owned by Standard Chartered Private Equity Limited and ZCCM IH.
The current Bulk Supply Agreement signed almost 20 years ago between CEC and ZESCO is expiring in March 2020.
But in a recent interview in Kitwe, Mr Silavwe said the delays in finalising agreement with ZESCO is threatening CEC’s existence.
Mr Silavwe explained that failure to renew the agreement with Zesco before March next year would spell doom for the Copperbelt as a whole.
He said CEC currently supplies electricity to all the mining companies with Konkola Copper Mines as its biggest client consuming the largest chunk of power from its network.
“We supply the power to everybody on the Copperbelt so it’s a question of how are we going to ensure that we do this in a way that will not antagonize the sector or the economy, I think that for me is quite critical,” he said.
“And I don’t think we have any challenges in achieving that in a very amicable and efficient way. I think what I would say is there is work that’s going on at the moment and that work is meant to find a solution to this. The Bulk Supply Agreement underpins the supply of power to everybody in the Copperbelt; it’s not just the mines, basically everybody on the Copperbelt. So, my view on it is that whichever way you look at it, a solution has to be found, if renewal is the solution, then so be it. But the critical takeaway is that a solution needs to be found, otherwise come that, day, nobody would want to see challenges on the Copperbelt, and basically challenges to the economy,” Mr. Silavwe said.
He added, “So, we should try, as a country, to avoid dooms day! I don’t think we plan for dooms day. We are working on it, but we don’t have a conclusion today. The fact is process is ongoing, today. It’s not about what I want to see, it what is mutually agreed between the parties at the end of the day, that is important.”
But some sources at the Ministry of Energy have revealed that there is pressure from some high ranking government officials for Zesco not to renew the agreement with CEC.
The sources said the officials have convinced Energy Minister Mathew Nkhuwa to prevail over the Zesco Board to renegade on the agreement and not a renew to CEC on the pretext that CEC bankrolls the UPND.
“You see there is a strong belief that CEC funds the UPND and the people in power are saying that why should ZESCO continue selling cheap electricity to CEC which is making huge profits that is now being used to fund the UPND,” the source said.
Efforts to reach Mr Nkhuwa proved futile by the time of publishing.
politics in everything sure
This is the nature of evil leaders. Whenever they think someone is a stumbling block to their hold on power, they will crush them regardless of the casualties.
1. Zambian airways was squeezed out of business by RB because he linked it to Mwanawasa
2. The Post was squeezed to death by Lungu because they published stories criticizing him.
3. Now CEC is in danger because they have been falsely linked to UPND.
They dont care how many people lose their jobs or how many families suffer as a result. They dont care that they are killing indigenous Zambian companies as long as they feel safe. And in the place of these companies you will see chinese firms that increase corruption and abuse of workers. Clap for Lungu the destroyer.
In decent countries, you can have CNN publishing all sorts of…
I don’t think that has anything to do with politics. CEC isn’t controlled by local shareholders. In any case, it’s a large organisation with all kinds of people and I doubt it they all support UPND or PF.
I was about to just say that. Thank you.
Zambia as country with such lack of integrity in the ‘so-called’ leaders, has been the main reason of lack in serious development of our country for such a long time.
Meddling in all affairs by ministers, be it neutral or otherwise in the interest of hailing themselves not the people of Zambia.
Whats stopping CEC from buying power outside Zambia or Invest in generation be it solar, wind and hydro? My learned brothers and sisters explain it to me please.
UPND Cadre from Ngombe Compound Lsk
Import power from where , Congo ?
Any other direction would mean using ZESCO transmission,
Why didn’t they invest in alternative power ? Well ….the same can be asked about the sacred ZESCO
Thanks Spaka.What about Mozambique, SA….? of course they would have to pay for transmission. But i thought CEC had to look at how it must first survive on its own. Just like the majority of our entrepreneurs are tenderpreneurs, CEC is in the same group. Just conduits of corruption.
CE is an unnecessary middleman that has raked in millions of dollars for nothing. It buys power from ZESCO for a song and supplies the mines at huge profits taking advantage of pre and post-independence law that created it as a middleman. It has exploited ZESCO pushing the company to the edge of extinction. ZESCO must be made to supply power directly to the mines and CE (CPC) must leave just like MOPANI and KCM. They are thieves like HH.
@Spaka, you’re mistaken. CEC was born earlier than Zesco. Zesco needs CEC to transmit bulk power. The relationship is mutual, so any disagreement will injure both. PF must not pick fights with everyone. Charles Milupi is just one of the minority shareholders.
Some one educate me. Is CEC the Copperbelt Power Company? If it is is it still not allowed to produce its own electricity?
You have to understand the history of CEC, which can be traced to a company that was called Northern Rhodesia Power Corporation established in 1952. In 1954, the company became the Rhodesia-Congo Border Power Corporation whose purpose was to supply reliable and secure electricity to the mines in Northern Rhodesia and the Congo by interconnecting separately run thermal power stations in the mining areas. Later, the company sourced and supplied hydroelectric power from the Congo to supply to the mines in Northern Rhodesia before the production of hydroelectricity from the Kariba Dam. At Zambia’s independence in 1964, the Rhodesia-Congo Border Power Corporation became Copperbelt Power Company (CPC), an entity that supplied electricity to the mines until 1986 when it was incorporated into the…
At Zambia’s independence in 1964, the Rhodesia-Congo Border Power Corporation became Copperbelt Power Company (CPC), an entity that supplied electricity to the mines until 1986 when it was incorporated into the Zambia Consolidated Copper Mines (ZCCM) as its Power Division. In 1997, CEC was born out of the privatization of ZCCM – Power Division. Cinergy Global Power of the USA and National Grid of the UK acquired the controlling stake in the Company. And this is how the company is associated with HH.
At Zambia’s independence in 1964, the Rhodesia-Congo Border Power Corporation became Copperbelt Power Company (CPC), an entity that supplied electricity to the mines until 1986 when it was incorporated into the Zambia Consolidated Copper Mines (ZCCM) as its Power Division. In 1997, CEC was born out of the privatization of ZCCM – Power Division. Cinergy Global Power of the USA and National Grid of the UK acquired the controlling stake in the Company. And this is how the company is associated with HH. He sold it.
So they are willing to plunge a whole province into darkness and let a lot of people lose their jobs just because of that? Doesn’t UPND affect how CEC operates?
*Does*
I would strongly support abolishment of CEC so that Zesco supplies electricity direct to Copperbelt-based mines. This would help Zesco become financially viable.
Inefficiency will slowly crip in as always
CEC owns the infrastructure, how will Zesco supply without using CEC?
3.2 Ayatollah,I think its not in all instances where CEC can be said to own infrastructure coz during RAMCOZ,ZESCO was ordered to supply directly to mines when CEC and RAMCOZ had a dispute! So I think it can be done for some mines BUT THE BEST WOULD BE TO ALLOW CEC TO INVEST IN GENERATION!!
Nemwine your thinking shocks me. On the surface, what is the reason, you think is there for Zesco not financially being financially viable? It is entirely their own mismanagement. Cec is run profitably because of good Management. That is how it has birthed CEC Africa, birthed CEC Liquid Telecom, Hai Telecom etc. Good mamngement. Zesco clearly lacks that. Would you tell me with certainty that they (Zesco) do not misuse money…..fund ruling parties??? CEC is most likely not even funding UPND at all but…..nshilanda Sana….. Am out.
It is a private company and ZESCO has to buy it if ZESCO wants to run it.
The mistake that was done by the UNIP government in 1986 was to incorporate CEC into ZCCM instead of ZESCO. Now it is a private company and ZESCO has to buy it if it wants to run it,
What stops CEC from dealing directly with the mines? Don’t the mines have the capacity to pay for the supply?
Does ZESCO have the alternative market? For instance DRC? And the means to supply other consumers?
Does the existence of CEC depend on the said agreement?
If indeed the Bulk Agreement won’t be reviewed one can only assume that there measures in place for ZESCO to meet the power supply on the copperbelt. Or is there real cause to speak of doom’s day?
Or is CEC just worried they may have to start buying electricity from ZESCO at a higher rate? If that be the, case, won’t CEC be able to recoup their investment?
Could someone kindly provide some answers. I see opportunities for CEC actually.
What stops CEC from dealing directly with the mines? Don’t the mines have the capacity to pay for the supply?
Does ZESCO have the alternative market? For instance DRC? And the means to supply other consumers?
Does the existence of CEC depend on the said agreement?
If indeed the Bulk Agreement won’t be reviewed one can only assume that there measures in place for ZESCO to meet the power supply on the copperbelt. Or is there real cause to speak of doom’s day?
Or is CEC just worried they may have to start buying electricity from ZESCO at a higher rate? If that be the, case, won’t CEC be able to recoup their investment?
Could someone kindly provide some answers. I see opportunities for CEC actually.
I hope this is not true… We cant leave in a country were any thing progressive is attached to UPND… Its no secret that alot of business would want to support HH coz of his prophesies which always comes true. mukapena guys to follow through everyone who supports the opposition..its not our problem that you have jerabo,s as supporters whose support is also dwindling.. Just imagine na bena leshina pa ZRA are supporting UPND…
Get ride of this Clueless lot. They see shadows even where there’s none. Next time, take time reflect before you vote. Don’t vote for dance and song. Vote wisely. These guys can’t believe you had put them in power as Clueless as they are! It will take the effort of the whole nation to get ride of them.
You called for competition in the Energy sector and Zesco has moved ahead of You to supply mines power and townships It has circumvented the control areas and lines to supply mines and townships directly except for those switch gears entrances It a technical knock out off CEC and we will see most of the employees taken over by Zesco new GRID to mines away from CEC which is a nationalist and Good Thing
CEC have been technically wounded up by Zesco and will be integrated into Zesco all the lines and connections are done directly to feed the mines bye passing CEC what a change of game
You either import negotiate or sell your Business and assets to Zesco Now The strength of CEC was in the agreements and not control areas we saw it coming but could be innovative also and see opportunities
Everything with PF is linked to politics of the belly and corruption
Their hold on corruption and clinging to power is more important than the country.
Just look at the defence force and police personal who are deemed UPND and have been banished ???
Really sad that PF think because they borrowed 17 billion for infrastructure everyone owes them loyalty and votes
As usual, the limited brains of the upnd will fall for this lie. Use your head sometimes. Maamba set up a generation plant, what do CEC do?? In your small brain, why should the contract be renewed when ZESCO are capable of supplying the mines themselves. Kwata anano, wabe ipuli!!
Look at this citizen rat…..
You think CEO are just middlemen ?
I believe they own some transmission lines and associated equipment.
Typical of the rats, even mamba generation they wanted to shutdown because they did not want to pay what they owed
@Spaka,
In Zambia CEC owns and operates an electricity transmission network in the Copperbelt area with 246 km of 220kV power lines and 678 km of 66kV lines. The company purchases electricity from ZESCO and sells this across its transmission network to 8 Zambian mining customers.
In 2013 CEC expanded its operations into Nigeria by taking a 75% stake in KANN Utility which in turn owns 60% of Abuja Electricity Distribution Company. CEC has 390 employees in Zambia and 3165 employees in Nigeria.
The issue at hand is the the bulk supply agreement signed 20 years ago! At the time (In the 1990s) the Kwacha/Dollar rate was K1000 (equivalent to K1 after Sata removed the zeroes)
One party has been refusing to review the agreement to take into account the vagaries associated with the economic…
…situation of our country because it would eat into the profits.
GRZ just coiled back its tail and went into hibernation. Now itys that time again to renew vows! We, as Zambians, await the outcome with abated breath….
Mind you, CEC owns backbone infrastructure. Zesco owns power. Meanwhile you need infrastructure to wheel power. Day zero is coming to Copperbelt if PF is playing game theory. Got to careful which game they are playing
Ba Zesco bekalefye let them not take the confusion ku CEC. They have failed to supply electricity to its current customers and now want to take their incompetence to CEC. Let that company be and let them continue supply power to the mines.
This is a publicity stunt by CEC, whose shareholders include Charles Milupi, to garner public sympathy. CEC for the past 20 years or so are merely middlemen who are chewing easy money. Instead of investing in generation capacity, they have sat back and relied on ZESCO to generate, transmit and then they distribute on already existing ZESCO infrastructure to distribute, although they added a few improvements on this distribution infrastructure. ZESCO are merely saying why do we need a middleman to supply our own service!! Unlike Maamba, who concentrated on generation, CEC have lost a good opportunity, nothing political here.
Iwe koswe
Even mamba you nearly had shut down because you did not want to pay what you owed , no ???
Is that all you can say?? Run out of lies now you bring up Maamba?? Kolwe nama shinshya pa chipato iwe!!
Zambian Citizen: Charles Milupi doesn’t control CEC. A shareholder he may be and it ends there. Milupi’s politics is extremely principled and is not driven by his ownership of shares in CEC.
That has Changed ZESCO has build infrastructure and Transmission line to all major mining houses and townships Its actually better able to supply power to mines than CEC that can only really on imports currently not available In national sense its a good thing but for Executives and individuals at CEC they must be assimilated into Zesco and compersation be made for any of the assets that could be sold to Zesco
They developed the assets and infrastructure to supply the mines Mufurila Lumwana Solwezi Kansanashi Kitwe wusakile and Chambishi actually there is a line from Kitwe to Mufurila now separate from that CEC
Could it be why Zesco has been talking of cost reflective tariffs for domestic consumers while the biggest consumers in the mines paid less ? We all need to pay for power fairly instead of domestic consumers subsidizing foreign owned mines that also dodge paying fair taxes. Let the the new bulk agreement be flexible enaf, otherwise we r tired of being shortchanged.
I fail to understand how dull some people can be.Honestly,how do you expect ZESCO to continue selling cheap electricity to CEC who in return sell the same power to mines at very high rates when ZESCO can directly sell power to mines and whole copperbelt?The logical thing would be CEC competing with ZESCO by generating and transmitting its own electricity.Whoever signed this bulk electricity deal 20 yrs ago was wrong.Business strategies change overtime.Thus CEC must be innovative than depending on a competitor – ZESCO.Truth be told,ZESCO would be making good profit by selling power directly to mines and the whole Copperbelt unlike via CEC(an agent).The UPND or political linkage to this issue is simply pure madness by crazy, blind UPND followers-period!!
A country that revels in ignorance.
“Boma iyamganepo mentality” This has nothing to do with politics. CEC had twenty years to develop alternative supply sources, but as usual Zambian we are used to either free, subsidized, cheap or stolen services and goods.
If a company can’t develop their own controlled service, then they are not worth being in business
Why does ZESCO need CEC to distribute power to the mines? Does CEC own the Copper belt distribution infrastructure? If ZESCO owns the distribution infrastructure then it’s difficult to appreciate why CEC has to play the middleman role. Do they refine ZESCO power? If CEC owned the distribution network, why not import power independently of ZESCO? If dirty politics have gotten in the way, then casualties will be many! We hope they won’t blame UPND again for their self-inflicted political injuries!
you mean ZESCO who are depending on a wall that was built The Queen of the British empire was a girls?,
TO reduce further the cost of delivered energy to Zambians and sectors Itezhi tezhi and mamba reverse merger will be positive towards creating a vertically integrated effective efficient utility units or GT TSO DISCOS They are just draining and eating to add on the tariffs also as IPPs for those revenues and profits much needed for re investments but lets integrate all those CEC into that TT
This politiking in the contractual renewal agreement between ZESCO & CEC will just worsen the operations of zesco. The CEC has huge inftrasture on copperbelt and ZESCO units current situation will notmanage it efficiently. Why put pressure on zesco board? Politician killed Zambia airways now they want to do same to CEC.
How much is CEC paying Zesco per kWh ?
CEC has built this infrastructure over years PF might not be in power over the next 20 years but whos is going to build that infrastructure, and as a Zambia built and owned company I would rather they stay cause we all know Zesco is useless were all seating with 8 hours plus darkness.
Zesco can build power but then not capable of doing distribution at the same time
Why is it difficult in Zambia to engage in a fruitful discussion without politics and insults.
CEC is a private company that should not be crying for tax payer funding. By compelling ZESCO to renew a non cost reflective agreement, we are encouraging indirect theft of our meager national resources
Its a good thing they have done with distribution infrastructure, but they should be ready to pay Cost Reflective tariff, just like everyone else
@ Ba Chilenje Augustine Mulenga., I hear you coz politicians owaz muscle in on most lucrative deals. It just shows the initial buyout & terms of the bulk agreement was tainted with political influence. Now that different political players r at play & CEC might have a few shareholders who are known to support the opposition, politics kicks in. The danger is that it might further affect our fragile economy negatively while the “elephants” fight. That’s the price to pay for trusting politicians too much…. naturally most African politicians are unpatriotic & can care less if the economy tanks as long as they score one over their perceived opponents…..
CEC is no different. CEC depends on the colonial and ZCCM infrastructure.
Difference, ZESCO (BOMA) has enhanced generation while CEC fat cats went on holiday at expense of Zambian Tax Payer’s money
Ask the PF government why they re not giving cec a licence to solar projects, Kabompo power generation project. Cec will soon start the construction of 20 MG watts solar generation plant but ask what conditions cec has been given by government.
3.2 Ayatollah,I think its not in all instances where CEC can be said to own infrastructure coz during RAMCOZ,ZESCO was ordered to supply directly to mines when CEC and RAMCOZ had a dispute! So I think it can be done for some mines BUT THE BEST WOULD BE TO ALLOW CEC TO INVEST IN GENERATION!!
What happened to CEC Kambompo Hydro Project? How much power are they generating from their pilot Solar plant, next to CBU? CEC is a private entity, surely over the years they should have developed strategic models outside Zesco Hydro. If they didn’t, it is time it dies out or they go into voluntary wind up, politics or no politics! It is very dangerous to have such entities in this century.