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Eskom will be selling Zimbabwe electricity again soon – just as long as South Africa has no load shedding

Phillip de Wet , Business Insider SA
 Aug 05, 2019, 10:09 PM
eskom
  • Eskom has agreed to a payment plan for Zimbabwe to settle its debt – and South Africa should start selling its troubled neighbour much of the electricity it requires again soon.
  • Zimbabwe will be receiving up to 400MW of power from South Africa, Eskom says.
  • But the deal is structured so that those exports are largely turned off if the SA moves into load shedding.
  • For more stories go to www.businessinsider.co.za.

Eskom has confirmed it will start selling large quantities of electricity to Zimbabwe again soon, fully reinstating a power export arrangement it curtailed after Zimbabwe had failed to pay its debts.

"Eskom can confirm that we have agreed on a payment plan for the outstanding debt and that proof of payment has been received," the South Africa utility told Business Insider South Africa on Monday.

"Eskom and ZESA [the Zimbabwe Electricity Supply Authority] are at the late stages of concluding an agreement."

Eskom did not say how much of its arrears Zimbabwe had settled. But at a meeting in Harare on Monday, Zimbabwe's secretary for finance, George Guvamatanga, said at least $10 million (the equivalent of around R149 million) was paid last week to foreign electricity suppliers – which he did not name – with an additional payment due this week..

The Zimbabwean government had previously promised such payments, and even said they had been made, but Eskom refused to continue discussions until it had actually seen the money in its bank account.

Eskom told Business Insider it would reinstate supplies once payment guarantees – which should prevent future debts from piling up – are in place.

Once the financial engineering is in place, Eskom will sell Zimbabwe up to 400MW, it said. But only 50MW of that will be contracted on a "firm basis". The remainder, a total of some 25% of Zimbabwe's estimated national electricity needs, will be on a "non-firm" basis.

When South Africa goes into load shedding "any non-firm exports are reduced to zero and firm exports are reduced proportionally in accordance to the loadshedding stage," Eskom said.

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