ZESA consumer debt balloons to $1,5 billion
Phillimon Mhlanga
HARARE – Debt to the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) has ballooned by 50 percent to $1,5 billion over the past six months as consumers continue to default on paying their rates.
The development comes as several firms across the country– that are still on postpaid electricity system—are experiencing serious cash flow problems as the economic slowdown impacted on electricity consumers’ capacity to pay for the provision of electricity.
ZETDC managing director Julian Chinembiri said last week that his company was implementing a “raft of debt recovery strategies” to deal with the rising debt.
“Under revenue collection, ZETDC is unfortunately owed a whopping $1,5 billion by defaulting domestic, mining, industrial and business consumers that are still on the post-paid electricity system, the position that has greatly compromised product and service delivery,” Chinembiri said.
“As a counter strategy, ZETDC has implemented a raft of debt recovery strategies that include the prepaid metering platform debt upload, payment plans, disconnections, key account management, set offs, litigation and stop orders for maize, wheat and tobacco.
He said ZETDC has recovered $40 million to date and revenue collection from defaulting customers was an ongoing process.
Chinembiri warned defaulting electricity consumers that they would be disconnected.
Business Times can report that the biggest culprits are municipalities, who hold the bulk of ZETDC debt.
In total, municipalities around the country owe the power utility about $400 million, according to an official document seen by this newspaper recently.
Of this amount, Harare City Council holds the greater part of ZETDC debt, owing the power utility more than $150 million.
Bulawayo City Council owes about $100 million while Gweru City Council and City of Kwekwe owe the power utility about $30 million and nearly $20 million respectively.
Kadoma Municipality and Municipality of Chinhoyi owe about $10 million each while Zvishavane Town Council and Municipality of Kariba owe the power utility more than $5 million and close to $4 million respectively.
Apart from municipalities, domestic consumers owe ZETDC more than $300 million, while farmers and industrial consumers owe more than $120 million and $105 million respectively.
Commercial and mining consumers owe ZETDC close to $100 million and more than $60 million respectively.
Government ministries owe a combined figure which has reached close to $60 million while parastatals owe the power utility close to $40 million. Exports and other consumers account for close to $20 million.
State-owned ZESA, through its power generation unit, the Zimbabwe Power Company, is generating about 1 300 megawatts (MW) against a national demand of about 1 600MW. To cater for the shortage, ZETDC is importing about up to 300MW from South Africa’s Eskom on a non-firm contract basis, meaning the power utility can only supply Zimbabwe when it has excess power.
ZETDC also import up to 50MW from Hydro Cahora Bassa of Mozambique on a firm contract basis.
