Sakunda Holdings is in negotiations with the Zimbabwe Regulatory Authority (Zera) and other statutory bodies to export electricity from its 200-megawatt Dema Power Plant to Zambia before year end.
The controversial Dema plant, which was set up in 2016 at a time the country was facing an acute power shortage, has been idle for over a year after Sakunda cut off supply to power utility Zesa over non-payment.
The plant was accorded national project status which allowed Sakunda to import fuel duty free, a privilege parliamentarians alleged was abused by the company, an active fuel trader.
Emergency Power plant
The tender for the emergency power plant was initially won by United States power giant APR Energy Holdings, which was later dropped under unclear circumstances, only for Sakunda to be handpicked without going to tender.
Sakunda, which enjoys a close relationship with President Emmerson Mnangagwa’s ruling Zanu PF, also funded government’s farmer support scheme, Command Agriculture, to the tune of US$264m.
The plant had to be mothballed because they were no longer getting business from Zesa as per the initial arrangement. Zesa had actually accumulated a debt running in excess of US $30m which was only settled recently.
“They have been actively looking for off takers locally as well as in the region but mostly in the region because they actually have the capacity to export,” said Zesa.
To make an impact into the region, Sakunda would have to review downwards its current tariff of 15 cents per kilowatt hour, which is excessive when compared to imports from the Southern African Power Pool as well as electricity produced at other power stations locally.
The Zimbabwe Power Company (ZPC), the generation unit of Zesa, produces power at Kariba at 4,11c/kWh.