Published:  12:17 AM, 10 October 2019

Zimbabwe quadruples electricity prices

Zimbabwe quadruples electricity prices A worker checks a furnace used to produce wall plaster as the Plaster Centre plant is forced to run at night to avoid 18-hour daily power cuts in Harare, Zimbabwe, July 25, this year. -Reuters

Zimbabwe hiked its average electricity tariff by 320% on Wednesday to ramp up power supplies at a time of daily blackouts, but the move will anger consumers already grappling with soaring inflation that is eroding their earnings.

The southern African nation is experiencing its worst economic crisis in a decade, seen in triple-digit inflation, 18-hour power cuts and shortages of US dollars, medicines and fuel that have evoked the dark days of the 2008 hyperinflation under late President Robert Mugabe.

The second increase in the price of electricity inside three months follows sharp rises in fuel and basic goods prices in the last week. But salaries have not kept pace, prompting citizens to blame President Emmerson Mnangagwa's policies for the crisis.

The Zimbabwe Energy Regulatory Authority (ZERA) said it had approved an application by Zimbabwe Electricity Transmission and Distribution Company (ZETDC) to raise the tariff to 162.16 cents (10.61 US cents) from 38.61 cents.

ZERA said the tariff hike was necessary after inflation soared - the IMF says it was about 300% in August - and due to a plummeting Zimbabwe dollar currency, which was re-introduced in June.

The currency has since then lost 58.61% of its value against the US dollar on the official market and more on a thriving black market. Consumers seem set for more increases after the energy regulator said starting November, the power utility would index its tariff to the US dollar to enable it "to recover from inflation and exchange rate changes."

The new tariff would allow ZETDC to raise money to repair its generators, as well as pay for imports from South Africa's Eskom and Mozambique which cost US $19.5 million every month, the regulator said.

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