…As EY appointed for ZESA rebundling
Top officials from the Rwanda Energy Group (REG) are heading to Zimbabwe for a benchmark visit to the State-owned power utility, ZESA Group, a collaboration which is likely to improve electricity access in Zimbabwe and Rwanda, it has been learnt.
Business Times can report that the delegation will land in Harare this Sunday.
Well-placed sources told this newspaper that several meetings are lined up with top officials from ZESA, the ministries of Energy and Power Development and Foreign Affairs and International Trade and the Rwanda Ambassador to Zimbabwe James Musoni.
The team will also visit Zimbabwe’s biggest coal-fired Hwange Power Station later next week.
ZESA Holdings acting spokesperson, Prisca Utete, referred all questions to the Ministry of Foreign Affairs and International Trade.
However, all efforts to get a comment from the Ministry of Foreign Affairs were futile.
ZESA Holdings executive chairman, Sydney Gata, could not be reached for comment. His mobile phone continuously went unanswered.
Several calls to the company’s fixed lines were not picked.
Last year in December, ZESA and REG signed a Memorandum of Understanding (MoU) in Kigali, Rwanda, on the cooperation between the two companies.
The MoU runs for five years, with the possibility of being renewed.
The MoU was signed between ZESA executive chairman, Gata and REG chief executive officer, Ron Weiss. Zimbabwe’s Ambassador to Rwanda, Charity Manyeruke, witnessed the signing ceremony.
The agreement provides the framework of cooperation and aims at laying the foundation for the establishment of a business understanding which may lead to signing of the energy infrastructure implementation partnerships agreements between the two parties.
The MoU covers areas including energy generation, transmission, reduction of energy losses, and capacity building of personnel.
Each part will benefit from each other’s experience in the implementation of energy projects.
Meanwhile, auditing firm, EY, which was engaged to look at the most suitable structure to reorganise ZESA has hit the ground running.
It is now expected that EY would come up with a proposal by the end of next month.
“They are doing consultancy work and will come up with a proposal on the actual structure. They will bring their recommendations to us for consideration. That proposal will be looked at and a decision will be made which will be followed by the implementation,” Energy and Power Development minister, Zhemu Soda told Business Times yesterday.
The proposed rebundling of ZESA is part of government measures to arrest the high cost of running the business.
Apart from several chief executives, all of the companies under ZESA Holdings have separate departments such as marketing, human resources, accounts and public relations, meaning there has been duplication of roles.
The unbundling of the power utility has also been blamed for exerting more costs on the company and the tariff, as all executives get huge salaries and obnoxious perks such as top-of-the-range vehicles.
Government first unbundled ZESA in 1997 and later in 2006.
The unbundling created five companies such as Powertel Communications, Zimbabwe Electricity and Transmission Distribution Company, the Zimbabwe Power Company, Zesa Enterprises and Zesa Holdings.
Further, the Government set up the Rural Electrification Agency and the Zimbabwe Regulatory Authority.
Cabinet approved in 2018 the re-bundling of Zesa after realising that its structure was contributing to the increase in costs as executives were getting huge–perks and top of the range vehicles.