Zimbabwe to pay Eskom a substantial amount of money next week

GOVERNMENT says it will pay Eskom of South Africa a substantial amount of money next week to ward off the imminent threat of load-shedding after the firm threatened to cut off supplies to Zimbabwe by Thursday over a $43 million debt.

Energy and Power Development Minister Dr Samuel Undenge yesterday said load shedding last experienced 16 months ago, would not return.

Zesa Holdings and Reserve Bank of Zimbabwe officials will meet on Monday to agree on the amount to be paid for now towards servicing the arrears owed to Eskom, to avoid being switched off.

Dr Undenge said Zesa officials would also be in South Africa next week for discussions with Eskom.

"The nation should be rest assured that there will be no load shedding as we are taking internal and external measures," he said. "We are working with the Reserve Bank of Zimbabwe and they will be meeting with Zesa.

"We will also dispatch a team to South Africa to engage the Eskom side. We will pay Eskom a substantial amount and we are confident that the power situation will remain stable as is the case now. There is no need for industry and the generality of Zimbabweans to panic. The situation is now under control."

Zesa has an outstanding import bill of $43 million and the irregular payments have seen Eskom threatening to cut supplies to Zimbabwe beginning next Thursday.

Zimbabwe gets 300 megawatts from Eskom and 50 megawatts from Hydro Cahora Bassa of Mozambique.

Zesa chief executive Engineer Josh Chifamba said: "We will be meeting with the Reserve Bank of Zimbabwe to work on the modalities before we engage the South Africans.

"We now have a clear picture and by Monday we will give you concrete details."

Zimbabwe consumes about 1 400MW daily against a generating capacity of around 980MW.

A further reduction by 300 megawatts would have a damaging effect on industry and winter wheat cropping season, which is under way.

Zesa overally owes Eskom $80 million and HCB of Mozambique $40 million, but the $43 million is emanating from a payment plan the power utility failed to honour due to foreign currency shortages.

To back up power imports from South Africa, Government recently issued a R500 million ($35 million) guarantee to Eskom and it is that surety that the South African power utility is threatening to call up.

Earlier this year, Zesa made payment plans with regional power utilities and should have paid $89 million between January and April.

The power utility managed to pay only $46 million under the payment plan which included last year's arrears.

The steady power supplies Zimbabwe has been enjoying since December 2015 are a result of various initiatives, including imports.

Officials from HCB of Mozambique were in the country this week and are said to "have had an understanding with Zesa."

The country's economic blueprint, Zim-Asset, identifies energy as a key enabler under infrastructure and utilities, as well as the value addition and beneficiation initiatives.

The cluster needs massive support and its failure spells doom for the country.

Industrialists and miners this week implored monetary authorities to prioritise power provision, saying any cuts on supplies would impact negatively on the recovering economy.