PROFESSOR Oliver Saasa says Zambia should increase its electricity tariffs in order to attract private sector investment in the energy sector.
Prof Saasa, who is an international economic consultant, said Zambia still had the lowest electricity tariffs in the Southern African Development Community (SADC) region which had not been attracting private sector investment in the power generation and distribution sector.
Speaking when he featured on Muvi TV’s “The assignment” programme dubbed “State of the Nation- Presidential Speech”, Prof Saasa said Zambia needed to open up the energy operational space to the private sector.
“We need to open up the power sector to the private sector by liberalizing the tariffs and making them cost reflective,” Pro Saasa said.
Prof Saasa said increasing electricity tariffs to more than double the current charges was critical for attracting private sector investment.
“This is when Zambia electricity tariffs are getting closer to the average in the region,” Prof Saasa said.
He said increasing the tariffs was ultimately what would determine whether the private sector would find the energy sector sufficient and attractive enough for them to move in.
“In fact what you need to do is perhaps guide this to what the government is suggesting, increasing the tariffs. Immediately the private sector gets in, allow them and the market to determine the price,” he said.
Prof Saasa said increasing electricity tariffs was the only way the private sector would move in and put Zesco on the run.
He said it would also bring about growth in the diversification in power supply and energy sources.
“I sit on the board of directors, by the way, representing Zambia, Kenya and Somalia on the PTA Bank. I am the chairman of the board and we have just financed one of the countries in East Africa with huge electrical installation for alternative energy sources such as solar energy,” Prof Saasa said.
He said Zambia must not learn to look for almost all the solutions at Zesco.
Prof Saasa said the interventions in the energy sector highlighted by President Edgar Lungu were mainly within Zesco.
“But Zesco has not performed well operationally in terms of profitability. It has had many major challenges of an operational and governance nature,” he said.
Prof Saasa said Zesco had failed to meet the demands that were rising because it had concentrated more on hydro-electricity.
Prof Saasa wondered whether Zesco had a department in charge of alternative energy sources.