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Why has Zesco not advertised emergency power import tender?By Diggers Editor on 8 Oct 2019
A system that is keen to foster transparency can be seen by its public procurement policies. One way of assuring the public or taxpayers of prudent use of resources is by showing transparency in the procurement of goods and services. People have to be assured that government and its institutions are making efforts to get the best prices of commodities. To do this, government tenders need to be advertised. Unfortunately, the public procurement process in Zambia is flawed.
Recently, the Honourable Minister of Energy Mr Mathew Nkhuwa told the people of Zambia that Zesco will be importing 300 megawatts of electricity from Eskom of South Africa at a cost of US$20.5 million per month. This amount seems to have been decided either in Cabinet, in a boardroom at the power utility or more realistically in the Zambian setup, during a drinking spree among a bunch of conmen.
We have not seen any advert inviting bids for this very lucrative government tender, and therefore, it is very clear that the Zambia Public Procurement Authority (ZPPA) has no say in this transaction. This is a clear case of lack of transparency and bad public procurement policy.
We have a problem with this decision because Eskom is not the only utility that can provide emergency power to Zambia in the region. We know for a fact that Mozambique is also a supplier of emergency power. In fact, this very government imported emergency power for two years from Mozambique between January 2016 and January 2018. This shows that there are competitors of emergency power supply out there who would be willing to throw in bids for the Zesco tender.
The fact that negotiations have already taken place and figures have been pronounced shows that we have a case of single sourcing in place. Even in the case of an emergency, under normal circumstances, the Zambia Public Procurement Authority should have been allowed to assess the circumstances and give a green light for single sourcing. This is not what is happening here.
If Zesco was interested in getting the most affordable power on the market so that consumers understand the cascading impact on tariffs, they would have cared to advertise this power supply tender. Failure to advertise goes against public interest. Consumers cannot appreciate a single-sourced transaction that only goes to increase the weight of the burden that they’re already carrying.
Why are we raising this concern? Basic geography tells us that Mozambique is much closer than South Africa. Given the short distance between Zambia and the electricity generation point in Mozambique, we would like to believe that the transmission losses of electricity would not be so much as compared to South Africa. So we don’t see the logic.
From that perspective, we do not think that government is operating in the interest of the consumers who are already complaining that the tariffs are too high. We don’t see why Zesco would want to deny players on the market an opportunity to reduce their bid offers so that they can compete and get the contract.
This approach taken by Zesco tells us that the tariffs that people will pay for the imported electricity will be determined by the amount of money that government needs to finance the budget and not the actual cost of the power they consume. How have Zesco and Eskom arrived at the US$20.5 million per month for the 300 megawatts of power? How did they determine this? That is why we are saying this tender should have been advertised.
Our suspicion is that they have rushed to Eskom where they have special contacts. And by the way, we all know the challenges that Eskom faces in South Africa. That is an institution which has been marred by corruption scandals. The same complaints that Zambian citizens have against Zesco are the same complaints that South Africans have against their Eskom. So we would like to know what motivated our government to ignore all other markets on this power supply tender and targeted South Africa.
We would like to submit that the easiest solutions for the power crisis Zambia is facing is by weaning off industrial consumers like the mines from the national grid so that they can independently import their own electricity. We believe that the power that Zesco is currently generating could sustain small industries, SMEs and household consumers with a more bearable duration of load shedding if need be.
Have our government technocrats given this a thought? We doubt, because even the solar alternative doesn’t seem to amuse them; they are not talking about it. So this government is not interested in affordable solutions, they want to solve these problems using costly means so that their private interests can be well served.
Just recently, international news agencies reported that Mozambique was willing to provide free electricity to Zambia on condition that Zesco reduces or stops the generation of electricity at Kariba so that the Cahorra Bassa Dam in that country stops overflowing due to cyclone-induced floods. We thought this was quite a deal for the Zambezi River Authority to preserve the much-needed water in the Kariba for future use.
But when we asked the Minister of Energy, he said government was not entering any such deal with Mozambique. Now what kind of humans would want to spend when something is being offered for free? Pompwes!
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