Govt tells power-hungry ferrochrome producers: Produce your own electricity, ease pressure on ZESA

Power hungry: Afrochine Selous plant

Government wants Zimbabwe’s ferrochrome producers, the heaviest consumers of energy, to produce their own power within the next two years and relieve pressure on the grid.

Energy Minister Edgar Moyo says power demand from the mining sector has now risen to 2,600MW as the industry expands and new projects come on stream. This is more than the total 1,400MW that Zimbabwe is producing currently.

“We have approved that these miners, particularly the ferrochrome miners who were being subsidised, should develop their own power generation plants, so that they can count power as their inputs, and not rely on the utility (ZESA) to provide power,” Moyo told The Chronicle. “We gave ferrochrome miners two years to set up their own plants. Many of them have already started. Some will commission their projects before the end of the year.”

“They can have their own solar plants to augment what they get from the national grid. We are going into a kind of partnership where the responsibility to provide power has to be shared between the Government and the mining companies,” he said.

The cost of power is the biggest expense for miners in Zimbabwe, following a significant 40% increase in tariffs last year, as reported by the Chamber of Mines. Miners state that electricity accounts for an average of 20% of the stay-in-business capital budget for mining companies. In response, many gold producers, including Caledonia and Dallaglio, have invested in alternative power for their mines.

The power cost is especially high for ferrochrome producers, who are heavy energy users and once enjoyed a “special power tariff” until it was dropped. Zimasco, one of the largest producers, has frequently shut down its plants over bill disputes with ZESA, at a time ferrochrome prices are down globally. Earlier this year, the company announced that it planned to build a 100MW solar plant near its Kwekwe plant. Among the other ferrochrome miners planning power plants are Jinan-Almid in Gweru and Titan Power in Hwange. Zimbabwe has 14 ferrochrome producers, the largest of which is Tsingshan’s Afrochine in Selous, which produces 100,000 tonnes per year.