The Times of Zambia (Ndola)
Times Reporter
29 April 2004
A UNIVERSITY of Zambia (UNZA) don has said that the issue of unbundling Zambia Electricity Supply Corporation (ZESCO) has been misunderstood resulting in the current wave of resistance among affected institutions.
In an interview in Lusaka yesterday lecturer in the School of Engineering Dr aLemba Nyirenda said proposals to restructure applied to the entire electricity market and not ZESCO alone.
He said the onus was on the Government to decide what mode of restructuring it wanted to adopt for the electricity industry and whether it really wanted to de-link Kariba North Bank from ZESCO.
ZESCO management and the union have protested against Government intentions to separate Kariba North Bank warning that electricity tariffs could escalate to as much as 35 per cent if allowed to proceed.
ZESCO also said the restructuring threatened the company's noble intentions to commercialise, an exercise which was already beginning to bear fruit.
Dr Nyirenda said, however, de-linking Kariba North Bank would not be in the best interest of the nation and the economy because there was a serious threat that tariffs could go up.
He said Government as owner of both utilities would have to act cautiously because the size of the electricity market was too small to contain any form of artificial competition.
"Such intentions can only be ideal when major players such as the developers of Kafue Gorge Lower and Itezhi -Tezhi enter the market. Just now it is very risky," he said.
He said the restructuring was proposing vertical unbundling where all power utilities, ZESCO inclusive would look at rationalising operations in their different licensed functions namely generation, transmission and distribution.
He said by commercialising, ZESCO was already carrying out some form of vertical unbundling.
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