Ray Bande recently at NYANGA
The demand for electricity is increasing as a direct result of the rise in the economy and to meet this acceleration in demand, the government, in addition to moving forward with the new generation of Zesa, is facilitating driving business for independent power producers to add their additional capacity.
In an extensive interview on the sidelines of a five-day third quarter strategic planning and performance review workshop held recently in Nyanga, Minister of Energy and Power Development, Soda Zhemu told the Herald that IPPs are an important component of the country’s power generation. and incentives are needed to ensure that they build their stations.
“Independent power producers are partners of the government in the supply of electricity. You will notice that there is a huge growth in demand and also through the President’s mantra Zimbabwe is open for business, there has been new demand which has been registered by many consumers. “So what we find is that even from the projects that are aligned by the government with the new capacities that need to be developed and the rehabilitation that needs to take place, we still see that there is a need private sector participation. This refers to independent power producers who could run their power plants on thermal or on renewable energy. “So they are a key player and stakeholder in the supply of electricity in this country. To this end, we have also offered a variety of incentives, through the Zimbabwe Investment and Development Agency (ZIDA). When an IPP enters Zimbabwe, all coordination, all permits and compliance requests would be handled by ZIDA. So for us, that’s one of the incentives because instead of jostling, everything can now be coordinated or managed in a one-stop shop,” he said. D.
Minister Soda said power generation investors also benefit from tax exemptions as well as a waiver of duties on equipment imported into the country.
“When an investor comes to invest in the country and brings equipment into the country, there are duties that he is not supposed to pay. And all this happens as a way to encourage investment, in particular for renewable energy components, batteries and solar panels all arrive duty free. We also offer tax exemptions,” said Minister Soda. Net metering has also been introduced as a way to incentivize producers independent power generators to generate for their own needs Under net metering, a user installing solar panels can sell the excess when the sun is shining and buy when it is dark, and the net balance is paid to the ZETDC or the producer.
“The other incentive is net metering where we encourage everyone who has a solar system on their roof, who is both a producer and a consumer, which we call a prosumer, should benefit from the generation of electricity.
“The concept of net metering is that if you generate more than you need, then you feed the excess into the grid and at the end of the day there is a reconciliation that is done. It is the only network that then determines who pays who pays ZETDC or ZETDC who pays the prosumer for the excess energy it has transmitted to the network,” he said.
Ideally, net metering is an electricity billing mechanism that allows consumers who generate some or all of their own electricity to use that electricity at any time, rather than when it is generated. This is especially important with renewable energy sources like wind and solar, which are difficult to store.