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The third public hearing on the proposal by the Zambia Electricity Supply Corporation (ZESCO) to review its tariffs has opened in Lusaka today.
The first two meetings were held in Livingstone and Kitwe.
Zesco Managing Director Cyprian Chitundu said during a presentation at the meeting that Zambia risks failing to meet her vision of being a middle income country by 2030 if electricity tariffs are not adjusted upwards.
Mr. Chitundu said the demand for electricity will rise to about 2,389 mega watts (MW) by 2015 thereby creating a deficit of about 540 mega watts if the tariffs were not adjusted upwards.
He also said without a tariff increase, there will be more load shedding, unreliable supply, restricted investment and derailment of development projects in the country
He restated that the quantity of electricity in the country was not sufficient to meet the demand noting that there was currently a shortfall of 165 mega watts between 18:00hrs and 20:00hrs.
Mr. Chitundu said the current domestic peak hour demand doesn’t meet the capacity because the country has changed a lot economically since the time of independence.
He said the solution to the electricity shortage would lay in the company’s plans to construct more power stations through investing about US$3.7 billion on assets and infrastructure this year and $26.4 billion in the next five years.
Mr. Chitundu said about 75 percent of the Zambian population has no access to electricity.
He said it was the desire of the company to fulfill government’s plans to have the entire country connected to the national electricity grid by 2030.
But Energy Regulation Board (ERB) Chairman George Chabwera said the country has adequate means of dealing with electricity demand fluctuations.
Dr. Chabwera said there was need to ask whether ZESCO’s business model was sustainable and whether there was another way to provide electricity to Zambian households.
He said ZESCO still needed resources to make electricity available despite their call to work with cooperating partners.
But Zambia National Farmers Union (ZNFU) vice chairperson Evelyn Nguleka opposed the tariff hike saying the move will among other things push the inflation of the country.
Dr. Nguleka said farmers were the biggest users of electricity and an increase in their cost of production will be passed on to the ordinary Zambians.
She further said if approved, the electricity tariff increase will also hamper the capacity of the agriculture sector as most farmers will not be able to export their produce.
Dr. Nguleka has since challenged the ERB to consider the application with utmost caution and should thoroughly investigate the issues advanced by the utility company.
She advised ZESCO to give farmers subsidies in the same manner it was providing to mines which she said have less direct impact on the ordinary Zambian.
Meanwhile, a clergyman from the Living Hope Pentecostal Assemblies of God Church Harold Gondwe said ZESCO should consider how much Zambians get as salaries before proposing tariff increments.
Reverend Gondwe said priority should be shifted from interests of high earners and big companies in the country to ordinary individuals who stand to face the full force of the adjustment.
Others who made oral submissions on the proposed 26 percent electricity tariff increase are ELCO Contractors, the Zambia Association of Manufacturers, the Zambia Institute for Policy Analysis and Research (ZIPAR), Richard Kabwebwe, Nelson Mushota and David Sikazwe.
