ZESA loses $40mln monthly due to power cuts

ZESA Holdings, Zimbabwe’s State-owned power utility, is reportedly losing US$40 million per month due to prolonged power cuts.

The cuts, which can last up to 18 hours, are a result of reduced generation at the Kariba hydroelectric plant caused by low water levels.

The Zambezi River Authority (ZRA), which manages Zambezi River has directed ZESA and ZESCO, Zambia’s power utility, to ration water usage from Lake Kariba, leading to a significant reduction in Kariba’s generation capacity from 1050 megawatts to an average 272.

“The average electricity usage time has been significantly reduced, and we are losing at least US$40 million per month,” said a ZESA official who requested anonymity.

“This has a severe impact given our high fixed costs. We have obligations to meet even when we are not providing service.”

These reports were corroborated by attendees of a stakeholder meeting on Monday, where industry representatives and ZESA discussed the ongoing power shortages.

“They told us they are losing between US$35 and US$40 million per month due to power shortages that have reduced consumption,” said one participant. “For example, a customer who typically spends US$30 per month on electricity might only need US$15 or less during periods of frequent outages.”

The amount of potential revenue ZESA is losing due to power shortages is nearly equivalent to the amount the utility needs to service the Chinese loan used to construct units 7 and 8 at the Hwange thermal plant.

No official comment could be obtained from ZESA.

Power shortages continue to pose a significant challenge to Zimbabwe’s economy. Many businesses are reporting increased downtime due to the unreliable power supply, while others are turning to expensive backup solutions like diesel generators.

ZESA has been facing a power supply shortfall of up to 540 MW during the high demand winter period. Total power supply is averaging 1 310 MW against a demand of 1 850 MW at peak, leaving a shortfall of 540MW.