HARARE – Zimbabwe’s industry and business sectors are increasingly alarmed by escalating power constraints, which have led to more frequent and prolonged electricity load shedding, threatening production and overall viability.
In recent weeks, the duration of load shedding has surged from about two hours to as much as ten hours a day. This has forced businesses to rely on generators and solar power to maintain operations, significantly increasing operational costs.
This situation persists despite the government’s assurances that it has implemented plans to ensure a more stable power supply during the winter season. Officials have claimed that load shedding would not exceed stage 1, despite the regional power crisis.
To safeguard national food security, the government has allocated 100 MW specifically for the winter wheat program. This allocation is part of a broader strategy to prioritize power supply to essential sectors, including mining, industry, water pumping, hospitals, and critical institutions, alongside winter wheat farming.
However, Zimbabwe National Chamber of Commerce (ZNCC) President Mike Kamungeremu highlighted that while the winter wheat sector has been prioritized, other businesses are experiencing significant disadvantages. “Businesses operating in specific areas like Southerton and Masasa have been somewhat shielded from severe load shedding. However, those outside these areas are struggling, often relying on costly generators, which greatly increases operational expenses,” Kamungeremu told Business Weekly.
He added that some businesses have reported entire days without electricity, with power restored only at night and then cut off again around 4 am, leading to substantial production losses.
The cost of alternative energy sources, such as generators, is prohibitively high, estimated to increase operational costs by 40% on average. “Businesses that require significant power investments for their machinery and plants find that using generators becomes economically unsustainable due to the high fuel costs,” Kamungeremu said.
A World Bank report titled “Electricity Growth Through Reliable and Universal Energy Access” noted that self-generated electricity is far more expensive than grid electricity, rendering firms uncompetitive. Power shortages have a substantial impact on the productive sector, leading to lower economic growth and reduced household incomes. The World Bank estimated that power supply shortages cost Zimbabwe about 6.1% of GDP annually.
According to the Zimbabwe National Statistics Agency (ZimStat), the index of electricity generation for the first quarter of 2024 showed a total distribution volume of 2,026.4 GWh, a 7.6% decrease from the 2,192.2 GWh distributed in the fourth quarter of 2023. The manufacturing, transport, and construction sectors consumed 616.5 GWh (30.4%), mining and quarrying used 286.0 GWh (14.1%), domestic consumers used 500.1 GWh (23.0%), other users consumed 474.5 GWh (24.7%), and the agriculture and forestry sectors used 159.6 GWh (7.9%).
Kamungeremu recounted the experience of a business member in milling who had to stop using an 80-litre-per-hour diesel generator due to its unsustainable cost, instead waiting for scheduled power restoration, resulting in significant production losses.
The World Bank’s medium-term projections indicate that Zimbabwe’s electricity demand will grow from 1,950 MW in 2022 to 5,177 MW by 2030, driven primarily by increasing demand from the mining and agriculture sectors.
Energy and Power Development Minister Edgar Moyo stated that Hwange units 7 and 8 are consistently producing over 600 MW, while Hwange units 1-6 are producing an average of 300 MW. Kariba’s output is optimized to produce an average of 250 MW, peaking at 400 MW. “We have several existing import arrangements and are actively involved in the Southern African Power Pool (SAPP) Day Ahead Market to access excess regional power. These short-term import initiatives will help address the power requirements this winter,” Moyo said.
Independent Power Producers (IPPs) are contributing an average of 50 MW, with solar net metering adding 24 MW and an additional 16 MW expected this winter. Confederation of Zimbabwe Industries (CZI) President Kurai Matsheza noted that rising electricity costs, coupled with supply shortages, are making production more expensive, costs that will eventually be passed on to consumers.
Matsheza acknowledged ZESA’s recent efforts to support industry but cautioned that persistent load shedding keeps businesses reliant on diesel generators. Minister Moyo attributed the power supply issues to low water levels in Lake Kariba, limiting the hydropower plant’s output. “We have lost over 800 MW of capacity at Kariba, making it difficult to supply sufficient power,” Moyo said.
Efforts to mitigate the power crisis include commissioning new units at Hwange and enhancing maintenance at existing units, along with promoting renewable energy projects and encouraging industries to develop their own power generation capabilities. Despite these measures, the power shortfall remains a significant challenge for Zimbabwe’s economic growth and industrial productivity.
Source: Business Weekly
