75% Electricity tariff hike a must, plead David Mabumba Victor Mundende
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By Derrick Sinjela
ENERGY Minister David Mabumba and Zesco limited Managing Director Victor Mundende say the 75 per cent electricity tariff hike is a must.
Both Mr. Mabumba and Mr. Mundende says the adjustment has been necessitated by the economic environment and a dire need to attack investment in hydro electric power generation.
During a 4th Tuesday April 2017, Zesco RETAIL TARIFF APPLICATION Media Brief Presentation at Government Complex in Lusaka, Mabumba and Mundende say inflation had previously risen from an average of seven to 22 per cent and low copper prices at US$ 4,5000, worsened by reduced income is viewed as a justification by Mr. Mundende for a two phased tariff hike of 50 per cent on 1st May and 25% on 1st September 2017.
However, Mundende says God answered prayers for a good rainfall as Zambia is largely a hydro powered electric country.
On investments, 200, 000 in 1992 to the present figure of 837, 000 domestic and commercial customer’s.
“”ZESCO has submitted an application to the ERB for a 75% tariff increase in 2017 to be implemented with initial 50% increase effective 1st May 2017; and an additional increase effective 1st September 2017 leading to the full 75% increase. The factors that have necessitated this increase include ‘Prevailing Economic Conditions; the need for investments in the sector aimed at increasing generation capacity to meet growing demand; the need to support ZESCO’s own investments in generation, transmission, distribution and supply; and the need to meet ZESCO’s rising cost of supplying electricity to its customers; The average consumption for residential customers is 312kWh/month. This therefore implies that out of the total 837,000 customers, 502,000 residential customers will enjoy a decrease in their bill,” explained Mundende.
Zesco’s mission is to become a hub of electricity for the Southern African Development Community (SADC) region.
Mundende says for Zesco to continue efficiently meeting demand, it is imperative for a tariff hike being approved by the Energy Regulation Board (ERB).
Currently serving as Patriotic Front (PF) Mwense Member of Parliament (MP) Mabumba says Zesco’s tariff application is progressive as a gradual hike on account of the Patriotic Front(PF) Government of President Lungu and Vice-President Inonge Mutukwa Wina being pro-poor.
Mabumba pleaded with media houses to preach the right messages as opposition parties are misleading the electorate.
Mabumba regrets that Zambia has not invested in power generation and transmission which must be overcome by attracting US$9 billion dollars.2017.
“Zambia is not an island and as such we need to make comparison with our peers,” advised Mabumba.
On Mining tariffs, Mabumba concurred with Mundende that negotiations over a uniform 9.3 cents per kilowatt are progressing accordingly.
Mundende says with the support by Finance Minister Felix Mutati, Commerce, Trade and Industry Minister Margaret Mh’ango Mwanakatwe, Mining Minister, Christopher Bwalya Yaluma and Energy Minister Mabumba, ZESCO has engaged in tariff negotiations with all mining companies.
“Through these negotiations, an average mining tariffs of United States Cents (Usc) 9.30/kWh has been agreed upon.
The new mining tariffs will be effective from 1st January 2017 until the completion of a new Cost of Service study by the Energy Regulation Board. Thereafter, we expect mining tariffs to be determined by the results of the Cost of Supply (CoS) study. We expect the ERB to conclude the study within the next 12 months,” explained a hopeful Mundende.
