Invest in renewables
Given that the power crisis is expected to get worse, local businesses should start allocating resources towards the use of renewable energy.
It follows a warning from Gloria Magombo, secretary for energy and power development, that ZESA will have to implement a painful load-shedding programme in the coming months due to severe power shortages.
After releasing the National Renewable Energy Policy (NREP) and the Biofuels Policy of Zimbabwe (BPZ), two documents that are anticipated to direct investment and production of clean energy alternatives in the nation, the government has since cleared the way.
These are thought to be crucial for Zimbabwe’s economic growth, as the country currently has a limited supply of grid electricity. Subsequently, the policy document was submitted to Cabinet and aims to grant national project status to all renewable power projects in order to facilitate their exemption from excise and customs laws. Companies would then be able to import specific renewable energy systems used in power plants at prices that are competitive.
The policy document also seeks to ease the regulation of power production to allow for independent power producers to participate in small hydro power plants, biogas and solar, who will sell electricity to ZESA.
Zimbabwe requires about 1 800MW a day but produces less than 1 000MW. To cover for the short fall, Zimbabwe’s power utility, ZESA imports from regional power utilities, especially Eskom of South Africa and Hydro Cahora Bassa of Mozambique. According to the energy document, the policy is in line with guidelines set by the United Nations Convention on Climate Change (UFCCC) and seeks to respond to the demand-supply ratio, grid absorption capacity and the ability of utilities to pay for renewable electricity.
Currently, Zimbabwe has a national electricity rate of 42%, according to official data obtained from the Ministry of Energy and Power Development. While electricity has reached 83% of the urban households, rural electrification is still around 13%. More than 50% of electricity in Zimbabwe is generated from hydropower at Kariba South Power Station while the remainder is from thermal power plant at Hwange, Bulawayo, Munyati and Harare stations. The limited generation capacity is attributed to water availability issues at Kariba Dam, old equipment which needs rehabilitation and limited coal supplies. The policy aims to promote investment in the renewable energy sector by providing specific incentives. It recommends providing National Project Status to all the renewable energy projects.
It encourages the Ministry of Energy and Power Development to recommend renewable energy projects on case to case basis to the Ministry of Finance and Investment Promotion for according Prescribed Asset Status so as to unlock Insurance and Pension funding.
It also recommends specific incentives for promoting third party sale of power. Further it recommends reduction in licensing fees and, relaxation in licencing requirements for renewable energy projects. Favourable tax incentives and rebates are also recommended in the NREP in addition to the existing Statutory Instruments. The policy also aims to address the development risks associated with the promotion of the uptake of renewable energy in the country. It outlines and suggests well-defined approval timelines for the administrative processes.
The policy thus also aims at addressing the barriers to the uptake of renewable energy in the country through different provisions and programmes. Primarily, the renewable energy sector in Zimbabwe consists of solar, hydro, wind, geothermal and biogas which include sugarcane based bagasse, biogas, forestry and sawmill waste.
