Governmental framework

The sector is primarily controlled by state-owned Zimbabwe Electricity Supply Authority Holdings (ZESA Holdings), which generates, imports and distributes all electricity in the country through its subsidiaries Zimbabwe Power Company (ZPC) and Zimbabwe Electricity Transmission and Distribution Company (ZETDC). The National Energy Policy 2012 foresees the unbundling and privatisation of what is effectually a vertically-integrated system. Initial steps have been taken towards reaching this goal, but private sector participation in electricity services is yet to be actualised.

Although the government has stated that renewable energy is crucial for energy sector development, the legal framework has thus far not actively promoted investments in this field. According to the Zimbabwe Electricity Regulatory Authority, a feed-in tariff has been developed for renewable energy plants up to 10 MW. However, the scheme has not yet been made public. Moreover, in 2014 the agency announced that a renewable energy policy would be formulated in cooperation with the Ministry of Energy and Power Development. The policy may contain clearer targets for the expansion of renewables in the country.


Governmental institutions

Ministry of Energy and Power Development (MEPD)

The Ministry of Energy and Power Development has the overall responsibility for energy issues in Zimbabwe. Its mandate includes policy formulation, performance monitoring and regulation of the energy sector, as well as research and development, and promotion of new and renewable sources of energy. The ministry supervises and oversees the performance of the energy utility and its subsidiaries. The current minister is Samuel Undenge.


Zimbabwe Electricity Regulatory Authority (ZERA)

ZERA is a statutory body established under the Energy Regulatory Act 2011, in conjunction with the Electricity Act 2002 and the Petroleum Act 2006. ZERA’s primary function is to regulate the energy sector. The agency seeks to create an environment that is conducive to competition and promotes efficiency in the electricity supply industry. The Energy Regulatory Act gives ZERA the authority to license any and all players involved in electricity generation, transmission, distribution and supply, and to regulate and approve tariffs.


Rural Electrification Agency (REA) and Rural Electrification Fund (REF)

The government recognises that rural electrification is vital to enhancing socio-economic development in rural communities. As a result, it established the Rural Electrification Fund (REF) in 2002 and later the Rural Electrification Agency (REA). The agency’s main focus is to spearhead rapid and equitable electrification of rural areas in Zimbabwe. To date, the rural electrification programme has delivered electricity supply to more than 5,000 rural institutions, farms, villages, boreholes, dam points and irrigation schemes.

The National Energy Policy 2012 puts an emphasis on coordinating the electrification programme, setting realistic targets and determining the most suitable mix of on-grid and off-grid technologies undertaken by the government.


Zimbabwe Electricity Supply Authority (ZESA)

The state-owned Zimbabwe Electricity Supply Authority is the country’s sole electricity generator, transmitter and distributor. It has delegated these tasks to its subsidiaries, energy generator Zimbabwe Power Company and Zimbabwe Electricity Transmission and Distribution Company. Further subsidiaries include ZESA’s investment arm, titled ZESA Enterprises, and internet provider PowerTel Communications (Pvt) Ltd.

The company’s mandate includes:

  • Safeguarding the government’s interests in ZESA and the electricity supply industry
  • Coordinating government policy for the electricity industry
  • Controlling the group’s financial resources
  • Reporting on group performance
  • Managing cost efficiency and service quality for customers
  • Optimising the benefits achieved through privatisation, protection, and growth of shareholder value
  • Promoting and supporting prudent practice in the unbundled subsidiaries
  • Strategic planning and risk management
  • Ensuring feasibility by undertaking research and development activities
  • New business development
  • Regional and international Relations


Zimbabwe Power Company (ZPC)

Zimbabwe Power Company became operational in 1999 as an investment vehicle for electricity generation. The organisation has been authorised to construct, own, operate and maintain generating stations for the supply of electricity.

ZPC currently operates four coal-fired power stations – the Hwange, Bulawayo, Munyati and Harare thermal stations – as well as the Kariba hydropower station. ZPC has a combined installed capacity of 1,960 MW.

Each power station holds a generating license from the Zimbabwe Electricity Regulatory Authority. The company generates electricity for the domestic market. The small thermal power stations operate as embedded generators (i.e. power stations that are directly connected to the distribution network), but are only used to meet supply shortfalls.


Zimbabwe Electricity Transmission and Distribution Company (ZETDC)

Zimbabwe Electricity Transmission and Distribution Company is a subsidiary of ZESA Holdings. ZETDC is responsible for electricity transmission and distribution, as well as supplies to end users. Its mission is to provide adequate, safe, reliable electricity and related services at competitive prices. The company has two divisions, Zimbabwe Electricity Distribution Company and Zimbabwe Electricity Transmission Company. The Zimbabwe Electricity Distribution Company is in charge of distributing and selling electricity to end users. It is responsible for managing distribution assets and carries out network planning, development, operation and maintenance. The division handles pricing and also aims to widen the customer base. Zimbabwe Electricity Transmission and Distribution Company is responsible for balancing supply and demand, the transmission of electricity from domestic generation plants, and electricity trading in the Southern African Power Pool.

ZETDC has been struggling financially in recent years. In February 2015, the CEO of ZPC stated that ZETDC owed Zimbabwe Electricity Supply Authority (ZESA) more than USD 558 million. ZETDC has previously tried to raise electricity tariffs, but the move was blocked by the regulator.


Regulatory framework – act, policies and regulations

Rural Electrification Act 2002

The Rural Electrification Act enabled the establishment of the Rural Electrification Fund Board, which holds and distributes money from the REF for rural electrification projects. It also paved the way for the expansion of the national electricity grid to rural government institutions, business centres and chiefs’ homesteads. The Act also allows decentralised renewable energy electrification.


National Electricity Act 2002

The National Electricity Act established the Zimbabwe Electricity Regulatory Commission (ZERC). The agency was responsible for licensing operators in the electricity sector and setting electricity tariffs, as well as general regulation of the electricity sector to allow fair competition. ZERC was dissolved following the establishment of ZERA in January 2012, and all of its duties were transferred to its successor.


Energy Regulatory Act 2011

The Energy Regulatory Act led to the establishment of ZERA, whose board has the power to issue and withdraw licenses to all players in the electricity, petroleum and renewable energy sectors. It is responsible for creating a legal framework that promotes fair competition among both private and public players.


National Energy Policy 2012

The National Energy Policy sets out a framework for measures that contribute to the development of the sector. Its objectives are to accelerate economic development, facilitate rural development, promote small and medium-sized enterprises, and ensure environmentally friendly energy development and efficient utilisation of energy resources.

The policy foresees the unbundling and privatisation of ZESA. It assigns an important role to renewable energy in achieving increased electrification rates and reliable on-grid supply. The policy endeavors to leverage the strong potential of renewables through the adoption of a long-term, government-led renewable energy technologies programme. It also targets the installation of an additional 1,250 MW of large hydro capacity by 2020.

In the policy document, the ministry announced the implementation of regulations for the installation of solar geysers in all new homes, the provision of incentives for retrofitting existing water heaters and the introduction of feed-in tariffs to promote on-grid and off-grid PV applications.