Zambia electricity price hike threatens mining output - Chamber
LUSAKA – Zambia's decision to increase electricity prices by almost 29% for mining companies is likely to hit operations in Africa's second largest copper producer, the Chamber of Mines of Zambia said.
The bulk power supply agreement tariffs between state power company Zesco and Copperbelt Energy Corporation were increased this week to 6.84 c/KWh from 5.31 c/KWh.
"Mining companies will not be able to absorb this cost, especially the high cost producing companies. The tariff increase is not sustainable at all," said the Chamber of Mines of Zambia, which represents the mining firms.
Copper exports account for more than 70% of Zambia's foreign exchange earnings and mining is a major employer in the southern African country of over 13-million people.
A nearly 10% decline in copper prices this year have already hit mining companies operating in Zambia, which include First Quantum Minerals, Vedanta Resources Plc, Glencore Xstrata and Barick Gold Corp.
The companies declined to comment.
"The mines are operating just above the break-even point and we should be mindful that the tariff hike does not distort their cost structure," said Noel Nkhoma, an analyst at the Economics Association of Zambia.
However, Christopher Mubemba, the director of generation and transmission at Zesco said the current tariffs that the mines were paying could not meet the power company's costs.
"If we are able to improve our income we will be able to give the mines the power that they need and in good quality," Mubemba told Reuters.
Comments
Research Reports
Projects
Latest Multimedia
Latest News
Showroom
Supplier & Distributor of the Widest Range of Accurate & Easy-to-Use Alcohol Breathalysers
VISIT SHOWROOM
Education: Consulting with member companies to obtain the optimal benefits from their B-BBEE spending, skills resources as well as B-BBEE points
VISIT SHOWROOM
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation
