RBZ and ZESA strike deal with ESKOM averting load shedding

Image result for zesaPotentially devastating load-shedding has been averted after the Reserve Bank of Zimbabwe (RBZ) and Zesa Holdings yesterday struck a payment deal to liquidate arrears to Eskom of South Africa within four months.

The South African power utility had given Zesa up to tomorrow to settle its arrears or risk being switched off over a $43 million debt.

Zesa officials are now expected to take the payment plan hammered out yesterday to Eskom for ratification on Friday.

This comes as Eskom over the weekend said it would not cut off the 300 megawatts it was giving Zimbabwe as Zesa had been “proactive” in its engagement.

Zesa chief executive Engineer Josh Chifamba yesterday said they had made progress towards settling the debt.

“I will not divulge details to you save to say we had a fruitful meeting with Reserve Bank of Zimbabwe Governor Dr John Mangudya,” he said.

“It seems we are on course and the situation is back to normal.”

However, a source that attended the meeting said: “The payment programme to be taken to South Africa will see us making monthly payments of about $10 million and this means in four months we will be able to liquidate the debt.

“We hope going forward Government will prioritise power supplies.”

Eskom spokesperson Mr Khulu Phasiwe said Zesa would not be switched off as it was making frantic efforts to clear the arrears.

“The Zimbabwe central bank wrote to us and is providing a Government guarantee for the debt,” he said.

“That is enough for us that the State has now stepped in. It’s not an unusual arrangement for the State to provide guarantees and even us at Eskom, we have Government guarantees for the debts which we owe. We are not even singling out Zimbabwe for not being able to pay.

“They have publicly acknowledged what they owe to Eskom. We as Eskom are not going to say the amounts owed to us in public except that they are now making arrangements to facilitate payment.”

Switching off Zimbabwe would have seen the country reverting to load shedding, which was last experienced 16 months ago.

Zesa has an outstanding import bill of $43 million and major creditors are Eskom and Hydro Cahora Bassa of Mozambique.

The Mozambican power utility supplies Zesa with 50 megawatts per day.

Zesa overally owes Eskom $80 million and HCB $40 million, but the $43 million is emanating from a payment plan the power utility failed to honour due to foreign currency shortages.

Earlier this year, Zesa made payment plans with regional power utilities and should have paid $89 million between January and April.

The power utility managed to pay only $46 million under the payment plan, which included 2016 arrears.

Zimbabwe consumes about 1 400MW daily against a generating capacity of around 980MW.

A further reduction of 300 megawatts by Eskom would have a damaging effect on industry and winter wheat cropping season, which is under way.

The steady power supplies Zimbabwe has been enjoying since December 2015 are a result of various initiatives, including imports.

Energy and power development are key enablers under Zim-Asset.

Source: The Herald

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