Industry wants USD power tariff linked to forex income

The Confederation of Zimbabwe Industries (CZI) says US dollar electricity billing should be matched to the proportion of foreign currency sales given that businesses have different mixes of local currency and forex earnings.

This comes after the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) announced a new US dollar power tariff of US12,21c/kWh for all exporters while other foreign currency earners would be billed at an average tariff of US10,63c/kWh.

Previously, most customers paid in Zimbabwe dollars, under a stepped billing system where users paid tariffs in line with the amount of electricity consumed while only a few exporters/partial exporters, including miners, paid in forex.

The industrial lobby said ZETDC’s tariff for exporters was way above the regional average of US11,7c/kWh, as per data from the Southern African Power Pool (SAPP), adding at this level the new tariff priced out Zimbabwe’s value-added exports.

Companies were also being levied different power tariffs, CZI said, for different times of off-peak consumption, which resulted in an effective tariff rate of US13,4c/kWh.

“Additionally, the computation of the MD (Maximum Demand) charge of US$5,71 per unit kilowatt, which most industrial users incur adds to the cost of production,” the business lobby group said.

Further, CZI said ZETDC indicated that the new tariff regime would be backdated to October 1, 2022 for Maximum Demand (MD) customers and October 14, 2022 for the rest of the consumers.

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