ZETDC moves to recover $1bn in unpaid bills

via ZETDC moves to recover $1bn in unpaid bills | The Herald July 15, 2015

Zesa Holdings power evacuation and supply unit, Zimbabwe Electricity Transmission and Distribution Company, is working on strategies targeted at recovering $80 million monthly of the $1 billion owed by customers in unpaid bills.

If successfully implemented, the strategies would increase financial resources available to replace stolen and vandalised equipment, which are estimated to have cost the power utility up to $30 million over the last 18 months.

Vandalism and theft of power infrastructure and reduced revenue affected power supply to households, industry and commerce amid crippling power deficit, with demand at 2 200Mw against generation capacity of about 1 300Mw.

The utility also believes that increased revenue inflows could help it improve maintenance works and expand its distribution network after its attempt to increase the power tariff was rejected by the Zimbabwe Energy Regulatory Authority.

ZETDC managing director Engineer Julian Chinembiri said in a recent interview the new strategies would soon be presented to the company’s board and parent Ministry of Energy and Power Development, before being implemented.

The multi-pronged strategies would also seek to minimise further debt accumulation by consumers of electricity, especially some that are still on the post-paid billing system and the others who have been defaulting on their payments.

“We are in the process of trying to come up with strategies which we would want to present to the board before we talk to our shareholders. We are segmenting each customer category. For example, the domestic customers are going to have different strategies, industry and agriculture different strategies and, of course, the mining industry will (also) be treated differently,” the ZETDC boss said.

“We are in the process of coming up with these strategies; the bottom line is that we need to effectively carry out credit control on the ones who are defaulting. We have a monthly target. Our monthly target, if all things go well, is supposed to be $80 million,” Eng Chinembiri said.

“That is after implementation of the strategies, which we are currently formulating. So far, we are still to sell the strategy to our board and, of course, to our ministry, but those things we are in control of have already started,” he said.

Part of ZETDC’s strategy, to increase inflows against a backdrop of growing debts from electricity consumed, has been the introduction of pre-paid meters. Over 500 000 was rolled out after the first phase of the new billing system.

About 800 000 meters are targeted for installation during the course of the Zimbabwe Agenda for Sustainable Socioeconomic Transformation (Zim-Asset) policy, which will guide Government’s economic plans from 2014 to 2018.

A tender for an additional 150 000 pre-paid meters will be rolled out, which the managing director said would be completed within a fortnight. The next phase of prepaid metering system installations will entail installation of predominantly smart meters, exclusively for heavy consumers of electricity, where the bigger benefits of prepaid meters is expected to come from.

Effective management of available power supply, amid constrained generation capacity, is critical to minimise the impact of shortages at a time when new projects are only expected to kick in after about 42 months.