ZIMBABWE’S three major coal producers have threatened to suspend the supply of the fossil fuel to ZESA unless the power utility pays its debt estimated to be over ZWL$68m by the end of this month, Business Times can report.
Such a move could trigger ZESA to escalate power cuts as thermal power plants might be idled in an economy already battling crippling rolling blackouts lasting up to 18 hours daily. This could bring the economy to its knees.
Coal producers Association chairman, Raymond Mutokonyi, indicated Friday that the coal miners, Hwange Colliery the country’s oldest coal producer, Makomo and Zambezi Gas, could not continue to supply coal without receiving payment.
It is understood that ZESA failed to honour an earlier agreement where it was supposed to clear the debt end of October this year.
“ZESA owes us over ZWL$68m after we provided the resource to various thermal stations for electricity generation,” Mutokonyi told Business Times.
He added: “We had an agreement that they were going to pay us by end of October but they failed to do so.
“If it continues to fail to honour its obligations we might be forced to cut off the supply to them.”
ZESA spokesperson Fullard Gwasira did not respond to enquiries sent to him Friday.
But, in a terse response to Business Times enquiry, Robson Chikuri, the acting managing director of Zimbabwe Power Company, the electricity generating unit of ZESA, said: “Not true.”
Zimbabwe is battling crippling power cuts lsrgely due low water levels at Kariba Dam. This has resulted in Kariba South Power Station generating less than 250 megawatts (MW) from a possible 1050MW, leaving the country, which requires about 1800MW daily but generates less than 600MW, dependent on its coal-fired power stations at Hwange, Bulawayo, Munyati and Harare.
The power utility also imports from regional power utilities. ZESA has non-binding agreement to import as much as 400MW of power from Eskom, which is unable to meet local demand after it has also implemented rolling blackouts across South Africa.
Mutokonyi also indicated that ZESA promised to pay coal producers after it has collected its debts from customers, estimated to be about ZWL$1.2 bn. Out of this mining companies, owe the power utility over $200m.
The threat comes at a time when coal miners have cut production output due to fuel and foreign currency shortages, according to Mutokonyi.
“Though the treasury has allocated fuel to the mining companies, the diesel is not enough for the extraction of coal. As a result, production has gone seriously down by a big margin making it difficult to us,” Mutokonyi said.