Zesa set to clear its US$76 million Hydro Cahora Bassa debt

by Staff reporter

2012 July 29 23:14:29 | 2068 Views

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Zesa Holdings is expected to clear its US$76 million Hydro Cahora Bassa debt by the end of the year after having paid US$40 million. The power utility is now making weekly payments of US$1,7 million as it battles to clear the remaining US$36 million.

Zimbabwe Electricity Transmission and Distribution Company managing director Engineer Julian Chinembiri last week said Zesa was trying to clear the debt, while at the same time paying for current imports.

Eng Chinembiri said projections were that the debt would be cleared by December.

â€œWe are doing the best we can, but the problem is we are servicing the debt and at the same time paying the current charges,â€ he said.

â€œIf we stop paying the current charges, it means the debt will continue rising.

â€œItâ€™s a matter of tackling two issues at the same time, but it is our hope that by year end we would have cleared everything.â€

Eng Chinembiri said power from Mozambique would be increased once Zesa clears its debt.

â€œThey (Hydro Cahora Bassa) have already made their commitments for this year and it means if electricity is to be increased we have to enter into negotiations with them and they would put us into their plans next year,â€ said Eng Chinembiri.

Zesa got US$40 million from two local platinum-mining companies, Mimosa and Zimplats and the money will be credited to their accounts as pre-payment for electricity.

Zesa tried to mobilise the funds through massive disconnections, but the response from domestic and commercial electricity consumers has failed to address the matter.

Hydro Cahora Bassa has agreed to ensure uninterrupted power supply in the interim if Zimbabwe continues to make periodic payments.

Domestic and commercial consumers owe Zesa Holdings about US$550 million.

Most residents, particularly in high-density areas, are going for almost 10 hours per day without power due to load shedding.

Zimbabwe requires about 2 200 megawatts daily, but generates only 1 300MW.

The remainder is met through imports from Mozambique, Zambia and the Democratic Republic of Congo.

Source: TH