Zambia Association of Manufacturers (ZAM) vice president Chipego Zulu says the reduction of load shedding by only two hours has not had any positive impact in the manufacturing sector because smaller industries are still grappling with the effects of having several hours without access to electricity.
Last month, government announced that it had commenced the importation of electricity from Eskom of South Africa, which was expected to reduce load shedding by just two hours from the then-15 hours schedule.
Commenting on the effect of reduced load shedding hours, Zulu said the two hours reduction to an average 13 hours per day had failed to have any impact on the country’s manufacturing sector as the 11 hours of power availability remained insufficient for the sector to spur productivity and contribute to economic growth.
“With regards to the importation of power from Eskom of South Africa, the manufacturing sector has always wanted solutions to the energy deficit. As an Association, we have been very consistent with our position regards on the need to have availability of power in order to enhance productivity and competitiveness of our products. The reduction of two hours of load shedding from 15 hours is still a large amount of time to not have power. So, the impact, yes, the might be a reduction of two hours, however, it still stands to reason that we need to solve the ultimate problem, which is that there is an energy deficit,” Zulu said in an interview.
She expressed concern on how government would sustain the power imports without pushing the cost of the importation to local consumers.
“The recent importation of power of an amount of US $27 million, we understand the rationale behind it given that there is need to invest in medium and long-term solutions. However, our concern remains around the cost of importation. Currently, that US $27 million is being subsidized by government; however, our concern, as manufactures, is that at some point, we, the consumers of power, will have to pay to cover for the importation. This raises our concerns in and around the discussions regarding the cost reflective tariffs and specifically then we call for the Cost of Service Study so that we are not hit with a very high tariff that consequently has an effect on our ability to produce competitively. The major concern is around how we are going to cover the cost of importation because it is quite high and specifically when we look at the two hours that this expected to reduce load shedding, it still stands to reason that we do not have adequate service supply of power and, basically, we still have discussion in and around the load management schedule to make it more consistent for industries,” said Zulu.
“The concern still remains with our small industries specifically because it is more difficult for them to adjust with regards to alternative sources of power, such as diesel generators, which are an expensive solution. There is still need for dialogue and consultation. I think we appreciate the efforts that are being made not only by the Energy Regulation Board, but by the Zesco management team to try and ensure that pressure on the grid is reduced, and also that they are listening to the stakeholders when it comes to medium to long-term solutions to the energy deficit. We see the new policy measures that are being put in place in the frame of the Electricity Bill and the Energy Regulation Bill and the consultative process around them as well. So, the energy deficit is a challenge for all of us as Zambians and we all need to be part to the solutions.”