Maravi

Zesco blames ERB over proposed tariff hike

Zesco blames ERB over proposed tariff hike
Written by Chiwoyu Sinyangwe
Tuesday, March 31, 2009 4:54:25 PM

ZESCO Limited has blamed Energy Regulation Board (ERB) for the proposed high electricity tariff adjustment, accusing the energy regulator of having resisted approving previous tariff hikes at a correct level.

And UPND Mazabuka member of parliament Garry Nkombo has urged the government to abandon the International Finance Corporation (IFC) - World Bank’s financing arm - as transaction advisors for the sake of expediting the development of the Kafue Gorge Lower hydropower station.

Zesco director for customer services Teddy Mwale said the power utility had initially structured the roadmap to reaching the cost reflective tariff level such that this year was supposed to result in lower tariff adjustment than last year.

“If our regulator [ERB] had allowed our previous tariff adjustment, the current adjustment would have been lower now as we go towards cost reflective tariff level by next year,” said Mwale over the weekend.

“We had structured our adjustments in such as way that subsequent increases were to be getting as we approached towards the cost reflective level of economic sustainability.”

And Zesco Limited managing director Rhodnie Sisala said the country needed to adjust the tariffs despite the current economic meltdown.

Sisala warned that the country was likely to come out worse of the current economic meltdown if the generation facilities were not improved.

“We need at least US $6 billion to deal with the energy situation if we are to meet the expected demand should the economic growth get back on track,” said Sisala.

And Nkombo said there was need for the country to move forward expeditiously on the construction of the Kafue Gorge Lower hydropower station.

He said previous studies on the 750 megawatts hydropower station, some which date back to the 1970s, had confirmed the viability of the project.

Nkombo was reacting to the statement by Peter Mumba on Saturday that the government would not solely rely on the advice of IFC on the proposed development of the Kafue Gorge Lower following its (IFCís) proposal that projected power output be reduced from 750 to 600 mega watts.

Labels: ENERGY, ERB, INFRASTRUCTURE, INTERNATIONAL FINANCE CORPORATION, ZESCO

posted by MrK @ 3:54 PM