ZESCO the power utility company in Zambia, has provided an explanation for the recently approved upward tariff adjustment, emphasizing its positive impact on reliable service delivery. Fitzpatrick Kapepe, ZESCO’s Head of Business Development, delivered a presentation to shed light on the matter.
During the presentation, Mr. Kapepe highlighted that the implementation of cost reflective tariffs would contribute to the financial stability of the institution. He further elaborated on the challenges faced by ZESCO in 2019 and 2020, where significant losses were incurred due to the inability to meet electricity generation and distribution targets, primarily attributed to high operational costs.
The prevailing economic conditions, including factors such as economic growth, inflation, and exchange rates, have hindered ZESCO’s service delivery capabilities. Mr. Kapepe asserted that the newly adjusted tariffs would serve as a means to cushion the impact of these factors, allowing ZESCO to enhance its service quality.
The Energy Regulations Board (ERB) approved ZESCO’s application to adjust its tariffs upward to be more reflective of costs back in April of this year. Since then, ZESCO has taken the necessary steps to implement the new tariffs for its diverse range of clientele. This includes metered clients, maximum demand clients, and social service clients, with the adjustments set to span over a five-year period from 2023 to 2027.
The tariff adjustments have been carefully designed to align ZESCO’s revenue streams with the operational costs incurred in generating and distributing electricity. By attaining cost reflective tariffs, ZESCO aims to address its financial challenges and pave the way for a more reliable and sustainable power supply to the people of Zambia.
ZESCO remains committed to fulfilling its mandate of providing efficient and affordable electricity services to the nation. The company is confident that the tariff adjustments will contribute significantly to its financial stability, enabling continued investment in infrastructure, maintenance, and capacity expansion, ultimately leading to improved service delivery for all its customers.
As ZESCO moves forward with the implementation of the adjusted tariffs, it remains dedicated to engaging with stakeholders, including customers, to ensure transparency and address any concerns related to the tariff adjustments.
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