The Zimbabwe Electricity Transmission and Distribution Company (ZETDC) is planning to raise electricity tariffs from US$0.1063 to US$0.1263 in order to raise funds. ZETDC is seeking to collect around US$2.95 billion to strengthen its network.
The utility also disclosed that it is owed US$243 million by electricity consumers and faces challenges in connecting 400,000 customers due to insufficient funding caused by low tariffs and vandalism of infrastructure. The ZESA subsidiary said non-cost-reflective tariff structures between 2009 and 2022 have resulted in a revenue deficit for the utility. The proposed tariff increase is currently being discussed in consultations led by the Zimbabwe Energy Regulatory Authority (ZERA). Speaking at the ongoing ZERA-led consultations with consumers on the proposed tariff increase, ZETDC said:
The impact was failure to maintain, expand and rehabilitate the electricity infrastructure at the same level as the number of consumers increased.
In order to maintain credit worthiness, ZETDC has to pay US$35 million every month towards the servicing of a loan for the upgrade of Hwange 7 and 8 power generators to the Chinese who did the rehabilitation works.
ZETDC also stated that the current electricity tariff rate of US$0.1063c, which was last approved in 2019, is insufficient to meet their financial obligations and power generation needs. ZETDC has acknowledged the concerns raised by residents regarding their contributions towards acquiring transformers and other infrastructure. The utility clarified that while there are different methods of making contributions, they bear the ultimate responsibility for maintaining their infrastructure.
To address issues of vandalism, which has led to the need for 27,000 transformer replacements, ZETDC plans to introduce anti-intrusion detectors for transformer protection. Residents who wish to contribute towards securing their transformers can coordinate with ZETDC officials, but the mechanism for these contributions needs to be reviewed to ensure transparency and accountability. ZETDC said it recognises the importance of working collaboratively with residents to address infrastructure challenges and improve service delivery.