The chief executive officer of Mutapa Investment Fund (MIF), John Mangudya, says the fund has now secured all the approvals needed to unbundle Zimbabwe’s State-owned power utility, ZESA Holdings.
Speaking during a public lecture on Friday, organised by Zimpapers in partnership with the Harare Institute of Technology and MIF, Mangudya said the move is designed to simplify how ZESA operates, make it more efficient, and ultimately bring down costs in the electricity sector.
Mangudya also confirmed that both the Cabinet and the Zimbabwe Energy Regulatory Authority (ZERA) have signed off on the plan.
For nearly 20 years, ZESA has operated in a fragmented way, ever since it was unbundled around the turn of the millennium. Back then, the power utility was split into five separate subsidiaries.
These included the Zimbabwe Power Company, which handles power generation; the Zimbabwe Electricity Transmission and Distribution Company; the Rural Electrification Agency, responsible for bringing electricity to rural areas; and ZENT, which manufactures electrical equipment. ZESA also owns Powertel, an internet service provider.
However, the fragmentation ended up causing a lot of problems. Multiple boards across the holding company and its subsidiaries made the organisation costly and bureaucratic, and inefficiencies crept in across the electricity supply chain.
In 2019, Ernst & Young, hired by the Government to review ZESA, recommended re-bundling its energy assets to fix these issues, but the recommendations were never put into action.
Now, under the new structure, ZESA Private Limited will hold 100 per cent ownership of the utility. The former standalone entities, such as ZPC, will become internal divisions.
The idea is to streamline operations, cut unnecessary costs, and make the whole electricity sector run more efficiently.
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