Zimbabwe’s state-run power company Zesa Holdings has warned of more electricity blackouts over a forex crunch, which is hampering the overhaul of damaged generation and distribution equipment, as the country’s economy teeters on the brink of meltdown.
Zimbabwe is experiencing its worst economic crisis since independence in 1980, which is blamed on President Robert Mugabe’s government and dramatised by shortages of foreign currency, fuel and food while inflation has surged to more than 1 000%, the highest in the world.
Zimbabweans have had to contend with frequent power cuts, going for days on end while industries, already groaning under the burden of high operating costs, inflation and a foreign-currency squeeze, have also been affected by the frequent blackouts.
”Zesa Holdings’ electricity generation and distribution capacity has been severely reduced by a combination of an ageing distribution network, vandalism of equipment and low tariffs,” Benjamin Rafemoyo, the managing director of Zimbabwe Electricity Distribution Company told journalists in Harare.
”The system we are running in Zimbabwe has seen its days and to a large extent by now should have been rehabilitated, but this is not possible due to lack of funds,” Rafemoyo said.
Zesa has struggled to generate electricity from domestic sources due to run-down machinery at its stations, while a foreign-exchange crunch has also hobbled its ability to meet the country’s 35% import needs.
The central bank has successfully lobbied Mugabe’s Cabinet to halt steep electricity tariff increases, arguing this would push inflation beyond its forecasts of between 280% to 300% by the end of the year.
Zesa, however, says the uneconomic tariffs that the government was forcing the utility to charge had left it critically short of money to rehabilitate the country’s largest thermal power plant, Hwange, which currently generates less than half its capacity of 750MW.
Zimbabwe in total needs in excess of $4-billion to refurbish its crumbling electricity generating and distribution equipment, which includes the Kariba South power station and smaller thermal stations like Bulawayo, Harare and Munyati. – ZimOnline