Gold mining companies in Zimbabwe have asked the Government to consider reduction of power tariffs for their business to survive the current downturn in the market.
According to the Zimbabwean Chamber of Mines (ZCM), gold miners already pay tariffs which are higher than the SADC average. In addition, the rate is not sustainable in the current economic environment of low commodity prices.
Chamber of Mines of Zimbabwe chief executive, Isaac Kwesu, said gold mining companies paid 13 cents/kWh, a rate he said was way higher than what others in the region paid. Power utility, Zesa Holdings’ average electricity charge stands at 9, 83 cents/kWh, which has not been adjusted since the last tariff adjustment in 2012.
Given this situation, Kwesu argued that it was only fair if mining companies could pay a rate that is consistent with sectors like manufacturing and agriculture.
“When you prioritise your foreign exchange, you also have to prioritise your energy costs in terms of propping up those who generate the forex,” he said.
The cost of power is among a host of issues the Chamber of Mines said the Government needed to address in order to improve mineral production. Other constraints, which have been identified, included high royalty fees, high corporate tax, numerous charges from regulatory authorities such as EMA and rural councils.