Changing the energy conversation in Zimbabwe
It is possible to keep costs tight and in-line with budgets after ZESA’s rate increase, says Norman Moyo, CEO of Distributed Power Africa.
The cost of power has risen, globally, and with it the cost of doing business. In Zimbabwe, the recent Zimbabwe Electricity Supply Authority (ZESA) tariff increase to US$0.1063 per kWh has had a significant impact on local organisations, fundamentally shifting budget planning and expectations. For the power company, the price increase is an essential step towards resolving the power crisis impacting the country and ensuring that services remain optimal. For the business, this increase of 356% from US$0.0233 kWh is set to hit the bottom line and knock-on prices for customers and consumers.
The challenge for ZESA is that it needs to invest into a degrading infrastructure that currently has to replace around 16, 000 rotten poles across 23, 655kms within its distribution network at a cost of US$2.1 million; connect more homes to the grid; undertake further maintenance on substations and feeder lines; and meet radically increased power expectations over the next eight years. It is anticipated that the latter will rise from 1,500 MW in 2022 to 5,177 MW by 2030.
Another factor that has to be considered within the rate increase is Zimbabwe’s commitment to renewable energy investment and infrastructure development. In the Renewable Energy Laws and Regulations Zimbabwe 2022 report, the National Renewable Energy Policy, 2019 (NREP) has the goal to achieve an installed renewable energy capacity of 16.5% or 1, 100MW of the overall electricity supply in the country by 2025 and, by 2030, this target should be 2,100MW or 26.5%. ZESA, as the owner of the Zimbabwe Power Company (ZPC) and Zimbabwe Electricity Transmission and Distribution Company (ZETDC) is responsible for achieving these mandates and for the management of renewable energy infrastructure.
The price increase is essential to ensuring that the country not only aligns itself with global and local climate change goals, but that it remains capable of delivering reliable energy across an ageing infrastructure. However, the rise of nearly 400% in price, even with the country previously having one of the lowest prices in the region, is going to have a measurable impact on the business. Organisations that are used to operating at a lower energy price point have to find new ways of managing the costs while ensuring that they retain customers and market traction.
This is where reliance on alternative power solutions and service providers can offer organisations a measure of relief, and richer control over energy pricing and budgeting. DPA offers a variety of solutions to the manufacturing sector in Zimbabwe, that are tailor made to reduce electricity costs while ensuring that systems remain online and operational throughout. These solutions mitigate the impact of the rising costs of diesel and electricity by providing 100% financed, maintenance-free energy solutions that stick to the promise of no more blackouts.
In addition to providing seamless energy on demand, DPA ensures that organisations remain aligned to the 2021 Revised Nationally Determined Contributed (NDC) to reduce GHGs with a focus on the energy sector alongside the waste, agriculture, forestry and land use sectors. DPAs distributed energy strategy anticipated the country’s commitment to reducing emissions with a 40% drop in greenhouse gas (GHG) emissions by 2030. DPA offers commercial and industrial organisations Power Purchase Agreements of up to 15 years with zero deposit at competitive prices – these solutions are designed to provide sustainable, renewable energy to organisations that prioritise the environment. Already an established contender in the renewables market, DPA’s solutions can handle immense power load and weight and has a proven track record in developing solutions of up to 75MW.
DPA has commissioned projects for Zimbabwean businesses that include Schweppes, UNESCO, Anglo American Mine UNKI, Tongaat Hulett, Tanganda, and First Mutual Park with a pipeline of 20MW ready for deployment. With a solid renewable foundation and a highly capable backbone of proven solutions, DPA offers organisations in Zimbabwe a trusted and cost-effective energy platform. For more information on a DPA solution, please contact us on enquiries@dpaafrica.com.
