Regulator turns down power tariff hike request

July 21, 2016 9:35 AM

Peak power demand in Zimbabwe has fallen over the last decade to 1,600 MW from 2,200 MW due to a prolonged recession that saw the economy contract by nearly half.

Zimbabwe regulator turns down power tariff hike request

Zimbabwe's energy regulator has turned down an application by the state-run power distributor to raise electricity tariffs by nearly 50 percent because it would hurt a struggling economy, it said on Thursday.

The southern African nation has experienced a devastating drought that has left millions facing hunger while a slump in commodity prices has left government struggling to pay salaries or fund basic services.

The Zimbabwe Energy Regulatory Authority (ZERA) consulted farmers, mines and industry on the proposed tariff rise and concluded that it would hurt the economy and raise the cost of doing business, it said in a statement.

Zimbabwe Electricity Transmission and Distribution Company in December applied to raise tariffs from 9.86 cents per kilowatt-hour to 14.69 cents, saying it needed the money to import power and improve supply.

"After duly considering the tariff application ... the ZERA board made a determination that the current tariff be retained for the year 2016," ZERA said.

Zimbabwe has since experienced chronic power shortages which have deterred investment and hobbled its economy.