Eskom, the South African state-owned power utility, is looking to replace Zimbabwe as an importer of electricity from Mozambique and Zambia to help ease rolling blackouts in South Africa.
Zimbabwe’s state-owned power utility Zesa Holdings said it is struggling to secure funds and is failing to sustain power import arrangements with Zambia and Mozambique.
Zimbabwe’s contracts with Mozambique’s Electricidade de Mocambique and Zambia’s Zesco are set to expire at the end of the month, according to Sydney Gata, the chairman of the country’s Zesa. Zimbabwe is failing to pay the $6.3 million (R104 million) monthly import bill to Zambia, he said.
Eskom is now “putting pressure” on the Mozambique and Zambian utilities to take over the contracts, Gata said.
In a letter to miners, Zesa executive chair Sydney Gata said the power utility is selling power below cost tariffs, is under immense pressure to “settle the ballooning power import debt” and is struggling with dilapidated equipment.
“Zesa had secured an Afrexim Bank facility which it used to pay off the power import debt in February, but the debt is growing back exponentially, posing a threat to the security of supply.
“Zesa has been charging an average tariff of US9.86c/kWh for exporting customers other than ferrochrome smelters, which is below cost, and hence has been failing to capacitate the utility to ensure the security of power supply and efficient service delivery. At the current tariffs, Zesa is failing to refurbish the generation, transmission and distribution network to improve service delivery.”
Zesa has negotiated for power imports with Zambia and Mozambique. However, since January it has failed to draw from these contracts because of a shortage of funds. Zesa has up to July 31 to draw the supply or the contracts will be cancelled and the supply reallocated to other utilities in the Southern African Power Pool.
“Zimbabwe will stand to lose heavily as these contracts are long-term, and at a competitive price,” said Gata.
Zimbabwe is set to receive 100MW of power from Zambia’s state-owned power utility early next month under a five-year deal and is in the process of negotiating another deal that will see it importing a further 150MW from Mozambique. Recently, the Zesa executive chair said the power utility required $17m monthly for power imports.
Back home, Eskom, which supplies almost all of South Africa’s power from coal-fired plants, has subjected Mzansi to intermittent outages for more than a decade because it can’t meet demand. President Cyril Ramaphosa said this week the company will turn to its neighbors to purchase surplus power, one of a number of measures designed to ease the crisis.
Earlier this week Eskom said it may have to bring power cuts at short notice after five units tripped at the Kriel power station.
The utility in a statement said that the fault appeared to be related to the heavy mist conditions that was experienced at the time.
Eskom said that the fault removed 2,000 megawatts of generation capacity from the system.
“While some generation units at other power stations are expected to return to service during the day, these will take time to load up to full capacity. Should there be any further loss of generation capacity during the day or some units fail to return to service as anticipated, load shedding may be required to be implemented at short notice,” spokesperson Sikonathi Mantshantsha said.