Business / Companies
Zesa pays Eskom $12 million
03 Oct 2017 at 06:13hrs | Views
Zesa Holdings has paid South African power utility, Eskom $12 million to avoid being switched off and will pay another $20 million this month as it battles to liquidate its arrears.
The power utility also presented a payment plan of $5 million a week beginning next month to settle the $44 million owed to Eskom.
The debt will however take about five months to clear as $12 million would go towards servicing current supplies every month.
Eskom has repeatedly threatened to switch off Zimbabwe, which is experiencing acute foreign currency shortages.
Zesa chief executive Engineer Josh Chifamba yesterday was tight lipped on the latest arrangement. "What I can only tell you is that everything is under control," he said.
"Zesa, Government and the Central Bank are working on the issue."
A Reserve Bank of Zimbabwe (RBZ) official, however, disclosed that the power utility paid $12 million last week despite the foreign currency shortages.
"The money was paid on Tuesday and we presented a payment plan which will see another $10 million being paid mid this month before another $10 million is paid at the end of this month," said the official.
"From then onwards, Zesa undertook to pay $20 million monthly in $5 million weekly instalments. From this amount $8 million will go towards servicing what we owe and $12 million will settle current supplies. If we do not default again, it means in about five month our arrears should be cleared."
Zesa is getting 300 megawatts from Eskom and another 50 MW from Hydro Cahora Bassa (HCB) of Mozambique.
The local power utility has on several occasions breached terms of payment plans agreed with Eskom.
RBZ Governor Dr John Mangudya last week attributed the challenge to foreign currency shortages.
He assured the nation that Zesa would "catch-up" so that the country continued enjoying electricity supplies.
Any load shedding at the moment will deal a major blow to industry as well as agricultural activities at Grain Marketing Board (GMB) depots and winter wheat farming that is currently underway.
Zimbabwe has been relying on power imports from South Africa and HCB of Mozambique to meet local demand as a way of promoting production in the economy.
Zimbabwe consumes about 1 400MW daily.
The country has been receiving steady power supplies since December 2015 as a result of various initiatives such as imports.
Zesa is refurbishing its power stations while also working on expansion projects in Kariba and Hwange.
The projects take time to complete, forcing the country to rely on power imports in the meantime.
The power utility also presented a payment plan of $5 million a week beginning next month to settle the $44 million owed to Eskom.
The debt will however take about five months to clear as $12 million would go towards servicing current supplies every month.
Eskom has repeatedly threatened to switch off Zimbabwe, which is experiencing acute foreign currency shortages.
Zesa chief executive Engineer Josh Chifamba yesterday was tight lipped on the latest arrangement. "What I can only tell you is that everything is under control," he said.
"Zesa, Government and the Central Bank are working on the issue."
A Reserve Bank of Zimbabwe (RBZ) official, however, disclosed that the power utility paid $12 million last week despite the foreign currency shortages.
"The money was paid on Tuesday and we presented a payment plan which will see another $10 million being paid mid this month before another $10 million is paid at the end of this month," said the official.
"From then onwards, Zesa undertook to pay $20 million monthly in $5 million weekly instalments. From this amount $8 million will go towards servicing what we owe and $12 million will settle current supplies. If we do not default again, it means in about five month our arrears should be cleared."
The local power utility has on several occasions breached terms of payment plans agreed with Eskom.
RBZ Governor Dr John Mangudya last week attributed the challenge to foreign currency shortages.
He assured the nation that Zesa would "catch-up" so that the country continued enjoying electricity supplies.
Any load shedding at the moment will deal a major blow to industry as well as agricultural activities at Grain Marketing Board (GMB) depots and winter wheat farming that is currently underway.
Zimbabwe has been relying on power imports from South Africa and HCB of Mozambique to meet local demand as a way of promoting production in the economy.
Zimbabwe consumes about 1 400MW daily.
The country has been receiving steady power supplies since December 2015 as a result of various initiatives such as imports.
Zesa is refurbishing its power stations while also working on expansion projects in Kariba and Hwange.
The projects take time to complete, forcing the country to rely on power imports in the meantime.
Source - chronicle
