ZESA, Dinson sign deal for the local manufacture of power pylons

Zimbabwe power crisis

Dinson Iron and Steel Company (Disco), the company currently building a new steel plant at Manhize, has signed a deal to manufacture electricity pylons for ZENT, the manufacturing ARM of ZESA, officials said Friday.

Disco is a subsidiary of Tsingshan, the world’s biggest stainless-steel producer.

Under the deal, ZENT will buy steel and other materials it needs to build the steel towers and other transmission equipment from Disco. Zent manufactures transformers for the ZESA network, but is struggling to meet demand because of years of underfunding.

ZENT MD Godfrey Mugaviri said his company is currently importing all its steel from China, India, Japan and South Africa.

“The beauty about this MoU is that ZESA Enterprises will be able to get Iron and steel, which are then used to manufacture transformers, power lines and other materials,” said Mugaviri.

Disco MD Benson Xu said the partnership is part of his company’s push to secure markets for future output.

He said: “We believe a combination between us and ZESA can bring positive results. Manhize is focusing on steel production but ZESA has more marketing muscle than we do because of its extensive network.”

Disco plans to complete a 1.2-million-tonne-per-year plant by next year, which Zimbabwe hopes will help it cut its steel import bill. Since the collapse of Ziscosteel, Zimbabwe spends around U$400 million every year to import steel and related products, according to Zimstat data.

Early in September, Disco said it had so far received orders of 250,000 tonnes of pig iron – or raw iron – and carbon steel from steel manufacturers.

In 2022, Disco and ZESA signed a public-private partnership to run a 97km high-voltage power line that will connect Manhize to the Sherwood substation, the main grid interchange near Kwekwe. To fund the project, Dinson provided a US$66 million loan to ZESA, secured through Stanbic Bank and Ecobank. The loan will be repaid through offsets on Dinson’s power bills.