It was only Sunday when the ZESA tariffs were hiked by another 50% following a 50% increase that was announced in October. I think it would be an understatement to say that we are still reeling from the last ZESA tariff increase. It seems like there will be little for recovery because we are going to see the price of electricity go up again according to a report from the Daily News.
The Minister for Energy, Zhemu Shoda was asked by members of parliament why the price of electricity was doubled in a short space of time. His response, according to the report, was that tariffs were too low.
“You will notice that 300kWh, the average cost per unit is around ZWL$6.33 whereas the optimum level that is supposed to be achieved is around US$0.10 cents if we are to restore the tariff to where it was in March.”
Zhemu Shoda, Minister for Energy and Power Development
He continued on to say that Zimbabwe is importing power at an average of US$0.9 cents as well as paying independent power producers who are feeding the grid the same rate. The minister went on to say that at present there is a subsidy for consumers because the average cost per unit is around US$0.6 cents.
The tariff increases, according to the report, are meant to make ZESA more sustainanble and the minister concluded by saying the nation should brace for more tariff increases.
This is troubling…
It goes without saying but we are living in extraordinary times. Zimbabwe was already in dire straits before the coronavirus hit and the pandemic just made things worse. Many people have lost their jobs or had their means of earning a living disrupted by public health measures.
Basic necessities are going beyond the reach of many in the country and a further increase in ZESA tariffs would mean that a number of people will no longer be able to afford the utility.
Now, the argument to make ZESA more sustainable is fair enough but the Zimbabwean people are facing incredibly difficult times. I might be alone in this, but I think the emphasis should be to provide as much of a cushion for the people as is possible over than anything else.
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If the financial dituation in country has stabilized, then it defies logic why ZESA yarrifs are jumping in lips and bounds during a perid of stability. Talking of an optimum level of ZESA tarrifs will only make sense if people’s incomes are also at optimum levels
Even if things are depressed, chefs still gotta have their Range Rovers, Cruisers and perks. Blood sucking leeches.
Zesa cannot cushion individuals, it is supposed to remain viable enough to provide a decent level of service. Not too long ago we were complaining of long loadshedding hours, partly caused by mismanagement and partly by the cost of importing power. As tariffs increased, power supply stabilised. So, if you want a continuous high subsidy, then brace yourselves for incredible loadshedding. You can’t have the best of both worlds, especially in the status quo.