Zimbabwean Businesses Hit Hard by Power Outages
Zimbabwean businesses are struggling due to severe electricity outages linked to low water levels at the Kariba Dam and frequent breakdowns at the Hwange coal thermal power station.
Companies across sectors, including mining and agriculture, are facing outages lasting up to 18 hours daily, with similar issues affecting neighboring Zambia.
Despite positive forecasts for the 2024/2025 agricultural season, these outages threaten productivity.
Mining firms, such as those linked to Impala Platinum and Anglo American Platinum, report losses of around $500 million in potential revenue this year, according to Lloyd Mlotshwa, lead analyst for IH Securities.
Some companies have resorted to costly electricity imports, as the ongoing blackouts disrupt operations and increase reliance on expensive backup power sources.
Matts Valela, chairman of African Distillers, noted that limited foreign currency access and unreliable power supply pose ongoing challenges.
IH Securities also highlighted that current electricity tariffs, around $0.14 per kilowatt hour, add financial strain, especially during outages when diesel generators are used, resulting in costs exceeding $0.30 per kilowatt hour.
Mineral revenues are projected to decline by 10% this year, falling to $5.5 billion.
To mitigate the crisis, Zimbabwe is pushing for independent power producers and developing several solar power projects.
A $3.6 billion energy industrial park in Beitbridge, in partnership with Chinese firm Palm River Energy, aims to construct a 1,200MW coal-fired power plant, with an initial 50MW expected soon.
-IOL
