State power utility Zesa Holdings says it will engage Bulawayo City Council (BCC) and other stakeholders to resolve the ownership wrangle over Bulawayo Power Station, which BCC claims to own.
This comes after BCC and a residents association objected to attempts by Zesa to have the generation licence for the power plant extended by 20 years from 2024, when the power utility would have completed its re-powering.
Bulawayo Power Station, which has outlived its useful life and is not producing electricity, is set to be revamped through a loan Government secured from the Indian Eximbank and on completion will generate 90 megawatts.
The plant is one of three outdated thermals, including Munyati and Harare, which are operated or supposedly owned by Zesa, but are scheduled to undergo re-powering to reboot their productivity.
The State power utility submitted the application for extension of the generation licence for Bulawayo Power Station sometime in December last year, subsequently publishing the notice of the application by Zesa in the local press.
BCC claimed Zesa was merely an occupant of the power Station owned by council and that the State power utility had not consulted the city fathers over its plans to extend the duration of the generation licence for the power plant.
The council is also livid that Zesa abruptly, and without justifying cause, allegedly abdicated its obligations of paying royalties to the city council for the use of the power plant facilities when the company was restructured into various standalone companies. As if that was not enough, BCC claims Zesa charged punitive tariffs, cut supplies whenever BCC failed to pay for electricity and sued over unpaid bills.
Like BCC, the Bulawayo Progressive Residents Association has also objected to the bid by Zesa to extend the generation licence for the antiquated power plant.
Following objections by both BCC and the residents association to the power utility’s plans, the Zimbabwe Energy Regulatory Authority (Zera) advised Zesa to resolve outstanding differences with council and the residents.
The State power utility said on Tuesday, following enquiries by The Herald Business, that it will engage BCC and local residents to resolve the impasse over the ownership of Bulawayo Power Station.
But Zesa insisted it was the legal owner of Bulawayo Power Station, through its generation arm Zimbabwe Power Company. Zesa said the power station was transferred to Zesa a long time ago in line with dictates of the Electricity Act, Chapter 13:05.
“In 2018, the Registrar of Deeds made an endorsement for the transfer of title deeds for Bulawayo Power Station to ZPC in terms of section 63 of the Electricity Act, thereby, giving ZPC full ownership of the station. ZPC is therefore not a tenant of Bulawayo City Council.
“In October 2018, ZPC followed the procedure of applying for a generation licence for Bulawayo Power Station from ZERA to allow for the station’s re-powering project of 90MW. This application can only be made to the energy regulator and not the Bulawayo City Council.”
Upon receipt of the application, ZERA went on to place a public notice (as part of procedure) in Bulawayo local press in December 2018 to solicit for written representations from members of the public on the application.
ZERA later responded to say that they had received written representations from BCC and the Bulawayo Progressive Residence Association in which they objected to the amendment of the electricity generation licence for Bulawayo Power Station because they had not been consulted by ZPC on the matter.
ZERA therefore could not proceed with processing the application until ZPC addressed this issues raised by council and the residents grouping.
“ZESA Holdings and its subsidiary ZPC are concerned about the issues that have been raised by the Bulawayo City Council and will immediately engage the BCC and the Bulawayo Progressive Residence Association to discuss the issues at hand,” ZESA spokesman Fullard Gwasira said in e–emailed responses.
BCC town clerk, Christopher Dube, was earlier this week quoted in Bulawayo media as saying the local authority reserves the right, as owners of the property, to review the continued occupancy of ZPC.
“The City of Bulawayo are the owners of the Power Station and was not consulted on the matter. The occupier of the property, ZPC, has neglected or failed to pay royalties or any other recognition for its occupancy. This is despite court orders establishing the legitimacy of such payments,” he said.
The Bulawayo re-powering project entails replacing the existing 10 chain grate boilers by two new circulating fluidised bed combustion boiler units (2x45MW).