HARARE – Zimbabwe plans to set a renewable energy tariff as part of efforts to lure investors into electricity generation.
The country — generating approximately 1 100 megawatts (MW) against a 2 200 MW peak and growing demand — is currently battling a crippling power crisis that has hit both industrial and domestic consumers.
Partson Mbiriri, the Energy and Power Development ministry’s permanent secretary, yesterday said the country was on drive to attract investors to energy generation, particularly renewable.
“Government is now at the final stages of developing renewable energy feed-in tariffs (Refit) and we hope that through this we will be able to entice investors into the sector,” he said.
Developed by the Zimbabwe Energy Regulatory Authority (Zera), the new policy structure would make it mandatory for power companies responsible for operating the national grid to purchase electricity from renewable energy sources.
Renewable energy feed-in tariffs would apply to renewable energy technologies such as solar power, small hydropower plants, biomass, bagasse and biogas.
The programme will provide a guaranteed purchase price for a fixed duration, ensuring an appropriate return on investment for developers.
Zera chief executive Gloria Magombo added that her organisation is currently reviewing relevant operational and capital costs of current renewable energy projects and determining the appropriate tariff levels and structures.
The Zimbabwe Electricity Transmission and Distribution Company, a subsidiary of Zesa Holdings, is
currently the most prominent national grid operator in Zimbabwe.
Mbiriri noted that government was committed to supporting renewable energy proposals and projects with minimal bureaucracy.
“Investors come here for business and they are not philanthropist and as such our tariffs should be based on costs.
“This is on the assumption that it is better to have renewable power than have none at all,” he said.
However, industry experts claim that while the new scheme may attract investors, it will also mean higher electricity prices for consumers.
In addition, there may be poor back up service in remote rural areas, limited local experience and expertise with some technologies, lack of awareness and inadequate funding for the sub-sector.
The government identified biomass, hydropower and solar as the short to medium-term strategy to address the energy deficit.
Zimbabwe’s tariff regime is set at an average of $0,09 per unit.
More than a dozen African nations are currently implementing or investigating renewable energy procurement mechanisms, among them South Africa, Kenya, Botswana and Namibia.