Two platinum mining companies have come to the rescue of cash-strapped Zesa Holdings by pledging to pay at least $40 million of the country’s debt to Mozambique’s Hydro Cahora Bassa (HCB) electricity.
Zimbabwe’s debt to the Mozambican power utility is estimated at just under $80 million.
HCB, which provides the country with close to 500 megawatts (MW), has on numerous occasions reportedly threatened to cut off power supplies to the country as a result of non-payment.
Zesa Holdings group chief executive Josh Chifamba confirmed the development on Tuesday, saying the money was not yet available, but was finalising the transaction.
“We have signed the agreement on the repayment with Mimosa and Zimplats,” Chifamba said. “They are putting in the final touches before disbursements.
“There are no more outstanding issues. “We covered the more challenging bit and how we will settle the accounts.
“We have always had good working relations with our customers. This means these companies have pre-paid their bills.”
Zimbabwe requires about 2 100MW, but is only generating 1 320MW with the shortfall covered by imports.
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Other foreign power suppliers are Zambia’s Zesco (200MW) and the Democratic Republic of Congo’s Snel (100MW).
South Africa’s Eskom used to supply 400MW to Zesa, but the contract expired in March 2011.
In January, Energy and Power Development minister Elton Mangoma pledged to pay $40 million towards settling the bill, but a delegation from HCB went back home empty-handed early this month after the power utility failed to honour the pledge.
Zesa is owed $450 million by customers. As part of efforts to raise money, the power utility has in recent weeks intensified its debt recovery measures by switching off non-paying customers.
Power shortages remain a major challenge for the business sector as Zesa has failed to address the matter, resulting in companies and individuals resorting to costly alternative power generation methods such as generators.
In his 2012 National Budget statement in November last year, Finance minister Tendai Biti projected power output to grow by 4,5% to 1 244MW this year, which is far from power supply levels required to drive sustainable production activity.
“Hence, power supply remains a major noose around the economy.
“Uninterrupted electricity supply will, however, hinge on sustained investments in power generation and transmission,” Biti said.
