Harare — ZESA Holdings will get US$132 million in loans and grants from the Development Bank of Southern Africa and African Development Bank for infrastructure rehabilitation once repayment conditions have been worked out.

It will only be known what impact the loan repayments will have on tariffs once the payment conditions have been settled, but it is likely that consumers will have to pay more.

The power utility has been battling with power shortages following a major breakdown at Hwange Power Station and is short of generating capacity even if all power stations are working flat out.

Zesa Holdings chief executive Engineer Ben Rafemoyo last Friday confirmed the proposed loan adding that officials were negotiating payment terms.

"We are busy courting potential investors and the funds from AfDB and the Development Bank of South Africa show that there are serious institutions prepared to work with us," he said.

Eng Rafemoyo said the Government was fully behind the deal, which was negotiated through the Ministry of Finance.

"Officials from the AfDB and SADB will also be working with officials from the Ministry of Finance for all the arrangements that we are going to make on the loan deal," he said.

Eng Rafemoyo said Zesa would use the funds to refurbish Hwange Thermal Power Station.

"Three out of six power generating units at the power station, which has a capacity to generate 750 megawatts, have been repaired and the other three would be operating before the end of March," he said.

Zesa Holdings recently announced that it has had to abandon its published load-shedding schedules because of acute power shortages.

Last week, the power utility started switching off power to customers who have failed to settle their bills with more than 500 houses in Harare's high-density suburbs being left in the dark.

Zimbabwe is currently relying on the Kariba Hydro-electric Power Station, which is generating power at full capacity.

The country is also importing electricity from Mozambique, Zambia, South Africa and the Democratic Republic of Congo.

Zimbabwe needs 2 000MW, but currently generates below 1 000MW while three small thermal power stations at Harare, Munyati and Bulawayo need US$150 million to become fully operational again.

Energy and Power Development Minister Engineer Elias Mudzuri last month said the Government would offer tax breaks to companies keen to invest in the electricity sector.