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ZERA Approves Electricity Tariffs Increment

The Zimbabwe Energy Regulatory Authority (ZERA) has granted the request by distributor, ZETDC for a tariff increase of US$0.02 a kilowatt hour, a rise of just under 19 percent for domestic consumers, but retaining the discounts for residential users with low demand. The most common household token of 250KW will now cost US$ 31, converted at the interbank rate on the day of purchase.

ZETDC has been facing rising costs  due to reduced Zambezi River flows, followed by tighter water rations by the Zambezi River Authority for the two Kariba power stations. Hydro Power station is a clean source of energy  which turns a valve to allow free water to accelerate down a shaft to the turbines making it cheaper whilst Thermal power is intrinsically more costly as coal has to be mined, moved, and burned to raise steam to spin turbines thus polluting the enviroment. 

ZETDC highlighted these reasons for requesting a tariff increment:

There are capital costs of servicing the loans raised to extend Hwange Thermal, although capital costs were fed into the calculations for the previous tariff. 

ZETDC has also raised the need for revenue to replace worn, stolen, and vandalized transmission equipment, such as transformers. 

To raise the revenue required for service provision in 2023.

To cover costs for the purchase of electricity, operations, and maintenance.

To cover regulatory costs, research and development costs

When granting the increase ZERA made it very clear that it expected:

ZETDC to maximize operational efficiency and collect on time all money it was owed.

Everyone on pre-paid power, which requires smart metering for the major consumers who pay most of their bills on their maximum demand for power, rather than paying entirely for energy as smaller consumers do.

ZETDC to have any tariff rises approved by ZERA, the independent regulator set up to ensure that an effective monopoly supplier can justify its tariffs before people pay.

For domestic consumers,the initial consumption for the first 50 units, after the requested increment will now cost US$ 3,45 whilst the 250 units that are normally consumed initially by an average household in urban areas will cost US$ 31. Those consuming around 400 units will see an average cost of US$ 61. High domestic consumers with heavy gadgets equipment such as boreholes and Jacuzzis with an average usage of 750 units will pay US$140 for their initial consumption.

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