28 June 2012

Zimbabwe: Billing Crisis Bleeds Zesa

ZESA Holdings might be losing millions of dollars in revenue to about half a million property owners nationwide using electricity for free.

The power utility has 600 000 registered properties in its database nationwide and cannot account for nearly 500 000 other consumers.

Zesa says it should be billing at least one million properties.

It also emerged that thousands of residential and commercial property owners are reportedly illegally connected, while others bypass electricity meters.

Zesa seems not to have correct records of properties developed by housing co-operatives and residents who are subdividing big stands.

When some of these properties are connected to the main power line, investigations have shown that Zesa takes over a year to give the new consumers account numbers for billing purposes.

Zimbabwe Electricity Transmission and Distribution Company managing director Engineer Julian Chinembiri yesterday confirmed that they had problems in compiling correct records of people who were using electricity.

"A lot of residential areas are being built and it means more consumers should get registered. It is our hope that by the end of the year we will have more than one million registered consumers.

"To increase our revenue base, we have to register more people and we encourage people to come forward. If we discover that one has been using electricity for free, the law will take its course," he said.

He said consumers were being logged in the database as and when they come to pay their bills or to notify them of new connections.

Some people stopped paying electricity bills during the Zimdollar era and Zesa is battling to update its system.

Eng Chinembiri said the power utility's budgeting and planning was based on registered consumers only, implying others were using power for free and the burden is put on those in the database.

"Our database only has 600 000 registered consumers whom we are billing. This means that we lose a lot of money as people and companies use electricity without paying.

"Zimbabwe has got a lot of households and those who are not registered either bypass meters or connect electricity illegally.

"When they bypass the meter, they disconnect electric wires to the meter and connect them directly, which is dangerous."

Eng Chinembiri said Zesa was putting in place mechanisms to register more people to increase the power utility's revenue base.

On pre-paid meters, he said the power utility needed US$60 million to install them countrywide.

He said Zesa rolled out a pilot project last week and was installing prepaid meters in various places.

The pre-paid system is expected to establish an efficient billing system.

"We are using 2 000 meters for testing and we are first installing in areas where we have non-functional meters that are recorded. We are doing the tests in Harare and Bulawayo.

"We secured 10 000 meters apart from those coming from the four companies that we contracted and one of the companies last week sent samples which we tested and passed. The companies will be paid after their meters pass the tests," Eng Chinembiri said.

The four companies are Solahart, ZTE, Finmark, and Nyamazela of South Africa.

"The reason for the delays was because most of the meters were coming from China, but if it all goes well from the 10-15th of next month we will be rolling out the project in full force," he said.

"We were supposed to have rolled out our pilot project on June 1, but there were delays," he said.

Zesa's billing system is based on estimates, a situation that has seen consumers refusing to settle their bills.

The situation has also seen the power utility failing to recoup hundreds of millions of dollars owed by consumers who argue that Zesa has a poor debt management system.

Zesa has no clear debt-collection strategy apart from the unpopular power disconnections.

A poor debt-management system has also seen Zesa struggling to settle foreign debts.

Consumers owe Zesa about US$550 million.

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