Tariff increase to help create jobs, says minister

David Mabumba

MINISTER of Energy David Mabumba says the 75 percent electricity tariff hike will enable Government attain its target of creating one million jobs over the next five years.
On Wednesday, the Energy Regulation Board approved Zesco’s proposed hike in

electricity tariffs which will be implemented in two phases effective Monday next week.
Mr Mabumba said the upward adjustment of the tariffs will attract more investors in the energy sector who will invest in projects that will create jobs for Zambians.
The minister said this in Lusaka yesterday during an energy sector conference.
Mr Mabumba said Government’s envisaged creation of one million jobs will only be possible if rural districts have access to electricity.
“Economic growth will be stagnant if the tariffs are low and the creation of one million jobs is dependent on the electrification of rural areas,” he said.
Zesco managing director Victor Mundende said the tariff hike will enable the firm to generate more income which will be spent on rehabilitating its infrastructure and improving electricity supply.
He said it is unfortunate that between 1979 and 2012, there was no investment in power generation and distribution despite the continued increase in population which raised demand for electricity.
“The upward adjustment of the tariffs means that our income will improve and we will be able to implement our ambitious projects,” Mr Mundende said.
And Mr Mundende said Zesco has partnered with a company from Mozambique to develop a 1,200 megawatts coal-powered plant.
And Zesco director for distribution Dennis Banda said the company loses K640,666 in vandalised electricity cables.  
Meanwhile, Maamba Collieries Limited chief executive officer Venkat Shankar says the firm will consider expanding its operations to create jobs for local people following the increase in electricity tariffs.
Mr Shankar said in an interview yesterday that with the increased tariffs, his company will have more business prospects with Zesco.
“Increased tariffs mean Zesco will be more financially sound and us who supply power will have better business prospects with it. We will also in turn become financially stable and generate more power,” he said.
Mr Shankar also said the hike in electricity tariffs will send a positive signal to investors.
“The current tariff regime is not cost-reflective of the market conditions and the revised one will send a positive signal to investors about Government’s commitment to ensuring that those doing business in the energy sector get a better deal,” he said.


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