ZESCO tariff uproar

Mon, 15 May 2017 10:13:40 +0000

By SANDRA MACHIMA

Uproar has erupted following revelations that the Energy Regulation Board (ERB) has unilaterally reduced electricity benefits offered to the poor and vulnerable members of society by Zesco.

At the same time ERB is reported to have exempted the largest electricity consumers, the mines, from the 75 percent electricity hike.

ZESCO proposed a 300 kWh lifeline threshold that would have left most household untouched by the 75 percent hike but ERB has reportedly reduced this to  200 kWh.

Energy Forum Chairperson Mr  Johnston Chikwanda has criticized ERB for the decision, calling it unfortunate, unprecedented and a perforation of public expectation.

He said it was a fact that ZESCO made its decision to give more relief to its own clients because there was a public outcry, hence making a public offer of 300 kWh lifeline. Thus, ERB should have allowed the request to pass.

“If ERB felt strongly about it, the other option was to reduce the offer to 200 kWh in September when the 25 percent portion of the tariff adjustment would come into effect.

“It would not have been a train smash to allow this request to pass especially that bulk consumers who consume more than 50 percent of electricity have been left to continue benefiting from the subsidy for a period of time which we do not even know,” he said.

Mr Chikwanda stated that the decision to stop the full range offer was not only a public slap in the face of ZESCO but it was embarrassing the government-the shareholder, adding that a close analysis of statements from policy markers revealed that ZESCO’s shareholder which was Government had approved the 300 kWh unless ZESCO management acted outside ‘minimum corporate governance’.

“Therefore, it is not far-fetched to conclude that ZESCO must have gotten Government approval to offer the 300 kWh lifeline as extended relief to its clients.

“And it is also untenable to imagine that ZESCO which is in direct interface with its clients did not make acceptable calculations when arriving at the 300 kWh lifeline for the ERB to swiftly come in between and overturn the intention.

“With the reforms underway, the ERB is encouraged to push for more powers which will allow it to intervene and regulate adjustments in the bulk supply agreements and impose significant financial penalties on both parties in bulk supply agreements should the parties fail to reach reasonable conclusions in a given time frame,” he said.