Finance and Economic Development permanent secretary George Guvamatanga has said that the government will soon review upwards electricity tariffs so that they reflect realities on the ground.
Zimbabwe is currently facing acute power shortages which resulted in the power utility, ZESA, implementing a 17-hour power cut for most suburbs in the country.
The shortage is attributed to reduced power generation at Kariba Dam due to shrinking water levels; reduced electricity generation at Hwange power station due to ageing machinery, and dwindling volumes of imported power from neighbouring South Africa and Mozambique.
Speaking at a business meeting yesterday, Guvamatanga said:
In US dollar terms, we are now charging 4 cents per Kw/h. You cannot expect electricity to be available. That was the same with fuel when it was wrongly priced and wrongly used. Price is also a bigger determinant of demand.
So we are very much aware of those distortions in power tariffs. You cannot be sustainable, neither can government afford to fund that gap. So there has to be a review very, very soon.
His remarks are in sharp contrast with those of Finance minister Mthuli Ncube who previously said that the government would not hike tariffs for obvious reasons. Ncube said that hiking tariffs had an adverse impact on the already struggling economy as it would only add to inflationary pressures.
ZESA has been calling for a review of electricity tariffs by as much as 30% citing the increased cost of production due to the devaluation of the local currency in February.
More: News Day
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