HomeBusinessZera concludes Independent Power Producer framework

Zera concludes Independent Power Producer framework

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THE Zimbabwe Energy Regulatory Authority (Zera) has completed developing an Independent Power Producer (IPP) framework, as government increases efforts to stimulate more private sector participation in the power sector

BUSINESS REPORTER

Zimbabwe is presently reeling from the negative effects of chronic power outages and attendant massive load-shedding as the power deficit continues to prevail. The country’s power deficit situation worsened in the year 2007 when the Southern African Power Pool also began facing a net energy deficit.

Zera chief executive Gloria Magombo said the authority is presently developing terms of reference, which is currently work in progress.

“We have developed a framework which clearly states what should be in a proper policy, what incentives should be in place, what issues we should be looking at to ensure more IPP participation,” she said.

The scheme is anticipated to draw more investment in the sector and ensure increased access to sustainable and reliable energy for economic growth.

“So we have already started moving on that aspect because we believe that the way we are procuring IPPs is not efficient, where you get unsolicited bids and then you get prices which are very difficult to then justify,” said Magombo.

She said as regulators, one of the key areas is to make sure that the authority balances the interests of both the investor and the IPP so that they get sufficient returns while affordability remains an imperative.

“We have done third party access regulation which will allow IPPs to access the existing grid network. We have been working with the utility and the existing IPPs to work on that and it’s something which is coming through as a statutory instrument so that they have a level playing field,” she said.

Magombo said the authority had catered for part of that through the grid code which will also be made into regulation soon adding that this was another potential area for tendering this year because a budget has already been made for it.

“If we need further assistance from technical partners I’m sure through the Ministry of Energy, there will be approaches based on what the bids turn out to be to see whether we can get assistance in that regard,” she said.

Thermals at most of the power stations in the country are more than 40 years old while the last power station ever put up in the country was in the 1980s.

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