THE Zimbabwe Electricity Transmission and Distribution Company (ZETDC) has decided to proceed and install pre-paid meters to its defaulting customers who have been resisting the move.
BY TARISAI MANDIZHA
ZETDC is battling to recover over $1 billion owed by various consumers and has approached the courts, suing at least 200 defaulters that include local authorities, state enterprises, individuals and private companies.
The defaulters that face litigation owe the power utility amounts ranging from $13 000 to $6,9 million each. ZETDC engaged the services of three law firms — Chinganga and Company, Baera and Company and Chihambakwe, Mtizwa and Partners — to recover the money. Some of them are contesting the claims.
Summons were issued since January this year and the cases are proceeding through the High Court in Harare. While some defaulters were yet to be sued, others have negotiated payment plans. Some of the individuals that have been taken to court include former central bank governor Gideon Gono and former Zanu PF legislator David Butau, who owe ZETDC $87 000 and $18 289 respectively. Parastatals sued include NetOne ($1,1 million) and Forestry Commission of Zimbabwe, among others.
The company is currently being owed $52 million by the mining sector, $210 million by industry, $436 million by the commercial sector, $294 million by the domestic sector and $84 million by the farming community.
ZETDC managing director Julian Chinembiri said the company was facing resistance in its bid to install pre-paid meters, but would, however, proceed with the programme.
“We actually wanted to put prepaid meters in the farming community but there is some resistance, but we are doing it all the same. Why can’t we be allowed to install prepaid meters at the farm houses?” Chinembiri asked.
“To us, domestic consumers are not much of a problem because we are collecting what they owe although the rate may be a bit slow. That is why we have now increased repayment of arrears to 50% of whatever power they purchase. The money we are raising from the prepaid meters is what we are using to run the company at the moment.”
He said because the small individual domestic consumers were the ones sustaining the company operations through the prepayment system, it would be “unfair to load shed power in the domestic sector in order to supply power to sectors which are failing to pay while domestic users are paying 50% of their debts every time they purchase electricity”.
Chinembiri said the company was supposed to get delivery of 130 000 prepaid meters but payment for the meters was a challenge. He said 4 500 meters have been stuck at Beira for more than a month due to payment constraints.
“As we speak, we only got a supply of 2 000 prepaid meters and our target was to complete the installation of 130 000 prepaid meters by year end but with the way things are moving, maybe we won’t be able to meet that target,” Chinembiri said.
He said the company required $30 million for 40 000 smart meters.
Chinembiri warned that power supplies were seriously compromised because of the $734 million in outstanding arrears owed by consumers. This situation could “lead to failure to procure power leading to load shedding”.
“ZPC [Zimbabwe Power Company] is owed and struggling to pay, threatening generation. Eskom, HCB and Dema require upfront payment. ZPC, Eskom, HCB and Dema accounts are in arrears and they threaten to discontinue supplies,” Chinembiri said.
Two months ago, the Zimbabwe Energy Regulatory Authorities threw out an application by ZETDC for a tariff hike to 14,69 c/kWh. ZETDC charges 9,86 c/kWh, which is lower than those charged in the region.
According to African Energy Resources.com, which compares regional utilities, South Africa’s Eskom is charging 13,54 c/kWh, Namibia’s Nampower (14,21 c/kWh), Zambia’s Zesco 11,36 c/kWh, Botswana BPC (9,74c/kWh), Swaziland’s SEC (10,53c/kWh), Lesotho LEC (8,18 c/kWh, Tanzania’s Tanesco (19,05c/kWh and Umeme of Uganda is charging 17,40 c/kWh.
Chinembiri said ZETDC’s tariff increase was mainly driven by an increase in costs to procure emergency power from the diesel plant at Dema and Eskom.
He said the company had incurred cumulative losses from 2009 to 2015 of $517 million, emanating from a low tariff which was not cost-reflective and ZETDC was projecting to make a loss of $189 million in 2016.
The ZETDC boss said the company required $20 million to replace faulted transformers at Alaska, Mutorashanga, Chertsey, Hwange and Orange Groove. It also requires $12 million to replace faulty distribution transformers and $10 million to maintain other critical spares and consumables such as switch gear and communication equipment, Chinembiri said.