Zambia may import 300 MW of power from South Africa, prices could double – minister

17th September 2019

By: Reuters

  

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Zambia is in talks with South African power utility Eskom to import 300 MW of electricity, Energy Minister Mathew Nkhuwa said on Tuesday, adding that retail prices could double once imports begin.

Zambia has a power deficit of more than 750 MW because of low water levels at hydropower dams, Nkhuwa told reporters on the sidelines of an energy meeting. He gave no timeframe for when imports could start.

"(Retail prices) will be maybe double the amount because we are paying half the amount that we are supposed to pay for electricity," Nkhuwa said.

Zambia, which has been rationing power after a severe drought hit its hydropower sector, has historically priced electricity below the cost of production via subsidies. Only in recent years has the country started gradually to raise prices.

In 2017, Zambia's energy regulator approved a 75% price hike for electricity retail consumers and introduced a flat $0.093/kWh tariff for mining companies.

Nkhuwa said the government also planned to send a delegation to Mozambique to negotiate a new power-purchase agreement.

Zambia cut its economic growth forecast to around 2% for 2019, from an estimated 4%, due to the impact of the drought on its power supply and agricultural production.

Edited by Reuters

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