Power Generation, Transmission & Distribution 2024 Comparisons

In Zimbabwe, the Ministry of Energy and Power Development is responsible for the power industry. Its major function is to develop an effective policy and legislative framework for the energy sector.

The Zimbabwe Energy Regulatory Authority (ZERA) was established in 2011 by the Energy Regulatory Authority Act (Chapter 13:23) (the “ERA Act”) and is responsible for the direct regulation of the power industry. ZERA took over the responsibilities of the Electricity Regulatory Commission, which was established under the Electricity Act (Chapter 13:19) and was previously responsible for the regulation of the electricity sector in Zimbabwe.

To ensure the provision of electricity in rural areas, the government enacted the Rural Electrification Fund Act (Chapter 13:20) (the “REF Act”), with the aim of facilitating the rapid and equitable electrification of rural areas. A government agency called the Rural Electrification Agency (REA) was established under the REF Act and its operations are funded through the Rural Electrification Fund (REF). REA is responsible for the construction of the grid network infrastructure in rural areas and the Zimbabwe Electricity Transmission and Distribution Company (Private) Limited (ZETDC) collects the levy and operates and maintains the developed infrastructure.

At present, the generation, transmission, distribution and supply of power in Zimbabwe are principally done by a wholly government-owned parastatal called ZESA Holdings Limited – the operations of which are conducted through subsidiary companies with distinct but interlinked responsibilities. The Zimbabwe Power Company (Private) Limited (ZPC) owns the power generation assets and is responsible for the generation of power. ZETDC owns the assets for the distribution, transmission and supply functions. ZESA Enterprises is responsible for providing support functions to the power generation, transmission and distribution entities.

The industry includes investor-owned registered independent power producers (IPPs); a total of 147 IPPsare licensed to date to carry out generation activities, with a combined capacity of 7 827.119 MW. As of January 2025, there were 58 operational IPPs with a combined capacity of 354.64 MW – with 17 of them feeding 77.63 MW into the grid, the balance being for own consumption. 

The generation, transmission, distribution and supply of power are principally regulated by the Electricity Act, read together with the ERA Act. The regulations under the Electricity Act for the licensing of the generation, transmission, distribution and supply of electricity were passed in 2008 as the Electricity (Licensing) Regulations 2008, published as Statutory Instrument (SI) 103/2008. They were further amended by Statutory Instrument 55/2015 (together, the “Licensing Regulations”).

The major applicable legislation is as follows:

• the Electricity Act (Chapter 13:19);
• the ERA Act (Chapter 13:23);
• the Electricity (Licensing) Regulations – SI 103/2008;
• SI 55/2015 Electricity Licensing Regulations Amendment; and
• Electricity (Net Metering) Regulations 2018.

ZESA Holdings Limited and its two subsidiaries, ZPC and ZETDC, own and operate the generation, transmission and distribution facilities in Zimbabwe. REA is responsible for the development of the power infrastructure in rural areas. ZPC is directly licensed to operate five power stations (four coal-powered and one hydro), which are all operational. It also has one hydro power station licensed under Kariba Hydro Power Company and one coal-fired power plant licensed under the Hwange Electricity Power Company, which is still under construction.

There are other companies that produce power for their own consumption, including Nottingham Estate (2.25 MW), Hippo Valley Estates (39 MW) and Triangle Estates (35 MW).

The Zimbabwe Investment and Development Agency (ZIDA) is the country’s investment promotion body, set up to promote foreign direct investment, local investment and the government’s decentralisation policy. It is established in terms of the Zimbabwe Investment Development Agency Act (Chapter 14:38) (the “ZIDA Act”). The ZIDA Act establishes a one-stop investment shop dealing with all issues to do with investment in Zimbabwe. It has a desk representing ZERA for those interested in investing in the energy sector.

In terms of the ZIDA Act, any person wishing to invest in Zimbabwe may obtain an investment licence from ZIDA in order to enjoy the protections and privileges accorded in terms of the ZIDA Act. These include:

• the right to invest in all sectors of the economy except the sectors reserved in terms of the Indigenisation and Economic Empowerment Act (Chapter 14:33);
• guarantees against expropriation, except for public purposes after due process of the law in a non-discriminatory manner following payment of adequate and prompt compensation;
• equitable and fair treatment of all investors;
• non-discrimination between foreign and local investors;
• non-discrimination between foreign investors;
• transparency in the treatment of investors;
• the right to freely move funds subject to tax obligations; and
• the right to employ senior expatriate staff in Zimbabwe.

The power industry is accorded the same investment protections as other sectors of the economy. The Constitution of Zimbabwe protects private property and prohibits the expropriation of property without compensation. Section 71 of the Constitution of Zimbabwe provides that every person has the right in any part of Zimbabwe to acquire, hold, occupy, use, transfer, hypothecate, lease or dispose of all forms of property, either individually or in association with others. The compulsory acquisition of property is only allowed where:

• the law permitting it is of general application; and
• the deprivation is necessary:
1. in the interests of defence, public safety, public order, public morality, public health, or town and country planning; or
2. to develop or use that or any other property for purposes that are beneficial to the community.

The person affected is required to be given reasonable notice by the acquiring authority, to be paid fair and adequate compensation before the property is acquired or within a reasonable time after the acquisition, and – if the acquisition is contested – to apply to a competent court before the acquisition of the property or no later than 30 days after the acquisition for an order confirming the acquisition. Additionally, any person whose property is acquired is entitled to apply to a competent court for the determination of matters relating to the acquisition, including the amount of compensation to which they are entitled. These rights do not apply where agricultural land is involved – in which case, agricultural land compensation is provided for improvements only.

Zimbabwe has also signed bilateral investment promotion and protection agreements (BIPPAs) with several countries for the reciprocal protection of investments. Additional protections are also available under these agreements. The specific protections vary from country to country.

Access to domestic courts is guaranteed under the Constitution of Zimbabwe. Additionally, Zimbabwe adopted (with amendments) the Model Law on International Commercial Arbitration adopted by the United Nations Commission on International Trade Law on 21 June 1985, to give effect to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards adopted in New York on 10 June 1958 (the “New York Convention”). Accordingly, foreign investors are free to resort to international arbitration, and awards from such arbitration proceedings are recognised and enforced in Zimbabwe.

Zimbabwe also ratified the Washington Convention on the Settlement of Investment Disputes between States and Nationals of Other States, which was incorporated into Zimbabwean law by the Arbitration (International Investment Disputes) Act (Chapter 7:03). This deals specifically with investment disputes. The New York Convention requires courts of contracting states to give effect to private arbitration agreements and to recognise and enforce arbitration awards made in the contracting countries. In terms of Article 3 of the New York Convention, each contracting state must recognise arbitral awards as binding and enforce them in accordance with the rules of procedure of the territory where the award is relied upon.

Various tax incentives can be negotiated and granted by the government, including exemptions on duty on the importation of capital goods. It is possible to negotiate for a project to be granted National Project Status so as to qualify for various exemptions on duties on the importation of capital goods into the country.

Licences are not transferable. ZERA is required to approve any mergers or acquisitions of assets. The sale of power industry assets or businesses, or other transactions, are subject to control by the Competition and Tariff Commission (CTC), which was established by the Competition Act (Chapter 14:28) and which requires that all notifiable mergers that are at or above the notifiable merger threshold are approved by it.

A merger is defined in the Competition Act as “the direct or indirect acquisition or establishment of a controlling interest by one or more persons in the whole or part of the business of a competitor, supplier, customer or other person whether that controlling interest is achieved as a result of[:]

• (a)  the purchase or lease of the shares or assets of a competitor, supplier, customer or other person;
• (b)  the amalgamation or combination with a competitor, supplier, customer or other person; or
• (c)  any means other than as specified in paragraph (a) or (b)”.

A notifiable merger refers to a merger or proposed merger with a value at or above the prescribed threshold of USD1.2 million in either the combined annual turnover of the acquiring firm and the target firm, or the combined assets in Zimbabwe of the acquiring firm and the target firm.

The process typically involves notifying the CTC of the proposed merger and paying the fees required, which are based on the combined annual turnover or combined value of the assets in Zimbabwe of the merging parties (whichever is greater), subject to a minimum of USD10,000 and a maximum of USD50,000. The process can take up to 90 business days. If the approval is granted, the CTC may impose any conditions it deems fit to ensure that competition is enhanced. These may include directives to dispose of certain services provided or the disposal of certain assets over a given period of time.

ZERA is mandated to regulate the entire energy sector in Zimbabwe in a fair, transparent, efficient and cost-effective manner for the benefit of consumers and energy suppliers. ZERA derives its mandate from the ERA Act, as read together with the Electricity Act, and regulations made thereunder.

Section 4 of the Electricity Act creates and empowers ZERA to regulate the procurement, production, transportation, transmission, distribution, importation, and exportation of energy derived from any energy source (renewable or non-renewable energy), as defined in Section 4 of the ERA Act. ZERA’s functions include:

• creating, promoting, and preserving efficient industry and market structures for the provision of electricity services, and ensuring the optimal utilisation of resources for the provision of such services;
• maximising access to electricity services by promoting and facilitating consumer connections to distribution systems in rural and urban areas alike;
• ensuring that an adequate supply of electricity is available to consumers;
• ensuring that the prices charged by licensees are fair in light of the need for prices to be sufficient to allow licensees to finance their activities and obtain reasonable earnings for their efficient operation;
• ensuring the safety, security, reliability, and quality of service in the production and delivery of electricity to consumers; and
• ensuring that regulation is fair and balanced for licensees, consumers, investors, and other stakeholders in the electricity industry.

In addition to the role of ZERA in ensuring the reliability of the electricity system and the adequacy of supply to satisfy the demand for electricity, Zimbabwe is part of the Southern African Power Pool (SAPP) – the headquarters of which are in Zimbabwe. SAPP has 12 member countries represented by their respective electric power utilities, organised through the Southern African Development Committee (SADC), and provides a forum for the development of robust, efficient, reliable and stable interconnected electrical systems in the Southern African region. It is also responsible for the co-ordination and enforcement of common regional standards regarding the quality of supply, as well as for the measurement and monitoring of system performance.

In September 2018, the Minister of Energy and Power Development published the Electricity (Public Safety) Regulations 2018 to impose safety standards on players in the electricity industry, in order to protect the public. Among other things, owners of generation and transmission infrastructure are required to:

• ensure that their assets are electrically safe;
• develop and implement asset design, procurement, operation, and maintenance plans to eliminate electrical risk;
• carry out periodic inspections and maintenance of electrical infrastructure, including the testing of protection equipment; and
• carry public liability insurance.

There have not been any material changes in law or regulation regarding the power industry during the past year in Zimbabwe.

The government of Zimbabwe has an agenda to provide a conducive environment to enable the participation of the private sector in the renewable energy sector. It was announced at the International Renewable Energy conference Expo 2024 that ten IPPs were expected to start generating 271 MW of electricity and selling to the national grid within a year with support from government through a standardised implementation agreement – namely, the Government Project Support Agreement. The Ministry of Finance and Economic Development and Investment Promotion and the Ministry of Energy and Power Development expressed that the focus was initially on being solar, with other renewables to be included later.

This follows the setting-up of a USD45 million-dollar fund to support renewable energy solutions. The fund was set up using a USD10 million-dollar support from the United Nations Sustainable Development Goals (SDG) Fund, with the remainder coming from the government and local partners such as the Infrastructure Development Bank and the Old Mutual Investments Group.

ZESA has also been on a push to encourage consumers with their own solar installation to join the net-metering programme to increase the power that is being fed into the grid. The drive is targeting individual households and other smaller producers with their own renewable energy sources. It is anticipated that this will bring many people on board, especially in urban areas where most households have been forced to resort to solar power to alleviate the unavailability of power.

The Ministry of Energy and Power Development recently announced the launch of an assessment initiative to accelerate the integration of decentralised renewable energy solutions into the country’s healthcare system as part of the review of the 2012 National Energy Policy.

This is not applicable in Zimbabwe.

The principal law that governs the entire electricity market is the Electricity Act (Chapter 13:19), read together with the ERA Act (Chapter 13:23).

Owing to the virtual monopoly of the ZESA Holdings entities, the wholesale market is virtually non-existent at present. In its National Energy Policy, the government intimated a desire to unbundle the transmission and distribution business units so as to create a bulk supply market that will facilitate and support IPP investments and serve as a basis for the transition to a more competitive wholesale market.

Imports and exports are permissible in the SADC and regions of the Common Market for Eastern and Southern Africa (COMESA). Power imports and exports are facilitated through SAPP.

Section 4(1)(d) of the ERA Act provides that one of the functions of ZERA is to promote co-ordination and integration in the import, export and pooling of energy from any energy source (renewable or non-renewable) in the SADC and COMESA regions.

Zimbabwe relies mostly on the main hydropower station at Kariba and the coal-fired Hwange Thermal Power Station. As of 16 January 2025, the peak supply mix of the total 1,160 MW electricity supply is:

• hydro – 15.95%;
• thermal – 79.22%; and
• IPPs – 4.83%.

There are no concentration limits regarding the percentage of electricity supply that is controlled in the market by any one entity, given the fact that the supply of electricity is still below demand.

Section 59(1) of the Electricity Act gives ZERA the ongoing responsibility for:

• monitoring whether electricity services are being provided competitively;
• determining whether any electricity service in respect of which prices or tariffs are fixed by ZERA can be provided competitively; and
• providing a report on these matters to the minister at least annually.

Subject to ministerial approval, ZERA may free a regulated service from price or tariff regulation and determine the time and circumstances in which this would be permissible.

ZERA also has the power to restrict the introduction of competition in certain areas, or of certain licensees or customers, on either a temporary or permanent basis.

ZERA also determines the pre-conditions and any transitional arrangements required in order for a regulated service to be offered competitively, which may include codes of conduct, rules relating to access to information, access to the electricity system, and constraints against undue price discrimination in the offering of services.

ZERA also has the responsibility to monitor electricity undertakings and markets, and is entitled to require information from licensees, to undertake enquiries and hearings, and to establish or contract with an independent entity to provide monitoring services.

In terms of Section 59(7) of the Electricity Act, ZERA is obliged to provide evidence to CTC of the presence or possible development of market power in the operation of licensed undertakings or electricity markets.

ZERA also has an ongoing responsibility to consider issues associated with the competitive provision of electricity services and the prevention or mitigation of market power in its decisions, and orders regarding matters such as licence applications, the granting of licences, licence terms and conditions, the setting of prices and tariffs, and whether to approve a merger, acquisition or affiliation, among others.

In terms of Section 59(8) of the Electricity Act, if ZERA determines that there is any problem related to the development or unfair exercise of market power, it may do the following (with the agreement of the CTC):

• issue such cease and desist orders as may be required upon the licensee or licensees concerned;
• levy monetary penalties upon the licensee or licensees concerned; and
• refer the matter to the CTC for investigation.

The principal law governing the construction and operation of generation facilities is Section 42 of the Electricity Act, as well as the Licensing Regulations. Under Section 42(1) of the Electricity Act, a generation licence authorises the licensee to construct, own, operate and maintain a generation station for the purposes of the generation and supply of electricity, subject to any terms and conditions imposed by ZESA and without contravention of the other provisions in the Electricity Act.

In terms of Section 42(2) of the Electricity Act, the holder of a generation licence may supply electricity to any transmission, distribution or supply licensee who purchases electricity for resale and – with the approval of ZERA – to any one or more consumers, subject to the terms and conditions imposed by ZERA and without prejudice to any other provisions in the Electricity Act.

For such purposes and in terms of Section 49(3), a “holder of a generation licence” includes any generating company outside Zimbabwe that is entitled – under an arrangement approved by ZERA or permitted by a licence issued to another licensee – to sell power to Zimbabwean licensees or consumers without a licence from ZERA.

In terms of Section 11 of the Licensing Regulations, anyone who operates an electric generator (including standalone generators) that is capable of generating, distributing or transmitting in excess of 100 kW must obtain a licence under Section 40 of the Electricity Act, unless they can show ZERA that the generator in question is for the sole use of their household or business. The notification must occur within 60 days of acquiring the generator. ZERA may order and conduct an inspection and, if it determines that the generator is for personal use, will issue an indefinite permit with conditions to comply with public safety standards and to allow further inspection by ZERA.

The principal laws are as follows:

• the Electricity Act (Chapter 13:19);
• the ERA Act (Chapter 13:23);
• the Petroleum Act (Chapter 13:22);
• the Electricity (Licensing) Regulations;
• SI 155/2015 Electricity Licensing Regulations Amendment; and
• SI 101/2021 Electricity (Licensing) (Amendment) Regulations.

Section 4 of the Licensing Regulations governs the processes and timelines for each licence. Applicants must fill out the appropriate application form (Form EL1 for primary licences and Form EL2 for secondary electricity licences) and pay the licence fee to ZERA (the amount to be paid is detailed within SI 55/2015, which is an amendment to the Electricity (Licensing) Regulations).

Within 30 days of receiving the application, ZERA must publish a notice in two consecutive issues of a national newspaper, inviting representations from the public in writing; thereafter, ZERA must forward such representations together with the application to the Technical Committee (which consists of technical experts retained as consultants by ZERA under Section 19 of the Electricity Act). The Technical Committee will have 45 days in which to consider the applications and representations and make a recommendation to the ZERA board.

ZERA may either grant or reject the application or may compel the Technical Committee to reconsider. In the event of a reconsideration, the Technical Committee will have 15 days to reconsider the application and report back to ZERA. ZERA may hold public hearings before its decision and may impose general terms and conditions over and above those usually included in a licence.

ZERA requires the following information/documents in order to consider an application for a power generation licence:

• proposed generation capacity;
• buyer/off-taker arrangements;
• electricity generation cost;
• grid impact assessment;
• fuel supply arrangement(s)/agreement(s);
• proposed power purchase agreement;
• proposed interconnection point to the transmission system;
• pre-feasibility/feasibility study report;
• maps indicating the location of the generating plant;
• land use permit;
• water extraction permit;
• environmental impact assessment prospectus/certificate; and
• project timeline/Gantt chart/implementation.

Section 47 of the Electricity Act provides for the terms and conditions that may be prescribed or that ZERA may reasonably determine in the circumstances. ZERA may prescribe terms and conditions after considering aspects such as:

• the size and scope of the undertaking or business;
• whether it is to be a monopoly or competitive service;
• whether the service is to be provided pursuant to a contract between the parties; and
• whether the service is to be provided to a consumer or to another licensee – provided that, in the case of a licensee whose services are provided pursuant to a contract, ZERA may incorporate in the licence the contractual obligations of the licensee or declare the terms and conditions of the contract to be the terms and conditions of the licence or part thereof.

The licence may also be issued subject to the following conditions:

• within a specified time, the licensee must divest any holding of shares in another licensee or comply with other such conditions that ZERA determines to be in the public interest, including adherence to any code of conduct;
• the licensee must make such reasonable provision as may be specified by ZERA in the licence for the facilitation of rural electrification in the proximity of the service;
• the terms and conditions of a licence may require the licensee to:
1. enter into agreements on specified terms with other persons for the provision or use of electric lines and associated equipment operated by the licensee;
2. purchase power and other resources in an economical and transparent manner; and
3. refer disputes to arbitration, mediation or determination by ZERA;
• the licensee must provide information on a periodic basis, in such form and detail as ZERA may determine;
• ZERA may allow a licensed activity to be exclusive for all or part of the period of the licence, for a specific purpose, for a geographical area, or for some combination of the foregoing;
• the licence will cease to have effect or will be modified or amended by ZERA in such circumstances as may be specified in the licence or as may be determined by ZERA;
• as a condition of its licence, unless expressly exempted by said licence, every licensee must prepare and submit to ZERA an annual statement of accounts in such form – and containing such particulars – as ZERA may require; and
• a licence will be valid for a period up to but not exceeding 30 years – although ZERA may extend the period of a licence, taking into account the nature of the undertaking or business, for an additional period not exceeding 20 years should it determine that it is in the public interest to do so.

In addition, and in terms of Part IV of the Licensing Regulations, a licensee must:

• comply with the consumer protection and performance standards;
• comply with the Zimbabwe Grid Code, the Zimbabwe Distribution Code, and any other codes specified by ZERA;
• notify ZERA in writing as soon as there is a material breach of a standard or code;
• undertake an operations and compliance audit at regular intervals notified by the code, completed by a designated and appropriately qualified person;
• maintain separate and ring-fenced accounts for its operations; and
• annually submit audited copies of its accounting statements to ZERA, together with the annual licence compliance return, and – where year-end falls at a time other than 31 December – within 45 days of the end of its financial year.

ZERA may impose general terms and conditions over and above those usually included in a licence.

A proponent does not have eminent domain or expropriation rights. Land use rights are usually acquired by way of leasing land from the relevant authority or municipality. The lessee then pays “rent” to the municipality as a form of compensation. One may also purchase the land outright. Way leaves can be negotiated with owners of private land or the local authorities.

The objective is to achieve an acceptable state as quickly as possible, reducing long-term maintenance to a minimum. On the socio-economic side, the plan regarding preparation for closure will largely have been carried out during the operational phase. Each facility should try to start planning for decommissioning during the planning phases of the development, so as to allow for smooth closure and decommissioning.

The construction and operation of transmission lines and associated facilities are again governed by the following:

• the Electricity Act (Chapter 13:19);
• the ERA Act (Chapter 13:23);
• the Electricity (Licensing) Regulations; and
• SI 55/2015 Electricity Licensing Regulations Amendment.

Section 43 of the Electricity Act regulates the subject of transmission and bulk supply licences. Subsection (1) states that, subject to such terms and conditions as ZERA may fix in the licence, a primary transmission licence will authorise the licensee to – inter alia – carry on grid construction and the operation and maintenance of transmission facilities within Zimbabwe.

Under Section 3 of the Electricity (Licensing) Regulations, every electricity undertaking that transmits in excess of 100 kW requires a transmission and bulk supply licence. Every undertaking that maintains (or proposes to maintain) a transmission facility, operates (or proposes to operate) an independent power exchange in terms of Section 43(1) of the Electricity Act, or is an electricity licensee (or applicant therefor) in terms of Section 43(1) of the Electricity Act is obliged to obtain an independent transmission and bulk supply licence in addition to its electricity licence.

Section 4 of the Electricity (Licensing) Regulations governs the processes and timelines for each licence. Applicants must fill out the appropriate application form (Form EL1 for primary licences and Form EL2 for secondary electricity licences) and pay the licence fee to ZERA.

Within 30 days of receiving the application, ZERA must publish a notice in two consecutive issues of a national newspaper, inviting representations from the public in writing, and must thereafter forward such representations together with the application to the Technical Committee (which consists of technical experts retained as consultants by ZERA in terms of Section 19 of the Electricity Act). The Technical Committee will have 45 days in which to consider the applications and representations and make a recommendation to the committee.

ZERA may either grant or reject the application or compel the Technical Committee to reconsider. In the event of a reconsideration, the Technical Committee will have 15 days to reconsider the application and report back to the ZERA board.

ZERA may hold public hearings before reaching its decision. Section 46(8) of the Electricity Act decrees that the period between ZERA’s receipt of an application and all documents and information submitted in support of it and the date on which it notifies the applicant of its decision or proposed decision shall not exceed six months, unless the applicant consents to an extension of the period.

ZERA requires the following information/documents when considering an application for a transmission line:

• a map indicating the route of the transmission line(s);
• information relating to the transmission system;
• line specifications – capacity, voltage, length, conductor type, configuration, etc;
• points of supply;
• contractual arrangements (where the applicant intends to operate transmission facilities that they do not own);
• a single line diagram;
• methodology for fees and tariffs for distribution use and connection charges;
• guidelines on non-discriminatory open access by third parties to transmission facilities (in the case of the primary licensee); and
• an environmental impact assessment prospectus/certificate.

This process can take up to two years, as it normally takes a while to obtain some of the documents and permits required to be submitted to ZERA with the application.

There are no typical terms and conditions imposed on approvals to construct and operate a transmission line and associated facilities in Zimbabwe.

Proponents of the construction and operation of a transmission line have no eminent domain, condemnation, or expropriation rights in Zimbabwe. Land use rights are usually acquired by way of leasing land from the relevant authority or municipality. The lessee then pays “rent” to the municipality as a form of compensation. If the transmission line is on private property, one must negotiate with the owner of the land.

Section 47(6) of the Electricity Act provides that “unless expressly indicated in the licence, the grant of a licence shall not hinder or restrict the grant of a licence to another person for a like purpose and in the absence of such express indication the licensee shall not claim any exclusivity”. However, ZERA may allow a licensed activity to be exclusive for all or part of the period of the licence, for a specific purpose, for a geographical area, or for some combination of the foregoing.

All prices or tariffs in connection with the provision of an electricity service or the operation of an electricity power system by a licensee or proposed licensee must be approved or fixed by ZERA. ZERA fixes or approves prices and tariffs for licensees with a view to:

• enabling an efficient licensee to recover the full costs of its business activities, including a reasonable return;
• providing incentives for the continued improvement of the technical and economic efficiency with which the services are provided;
• protecting consumers while keeping them informed about the cost their consumption imposes on the licensee’s business;
• avoiding undue discrimination between customers and customer categories; and
• phasing out or substantially reducing cross-subsidies.

ZERA may, however, allow a lifeline tariff for some customers. ZERA also has the authority to approve prices and tariffs that are established pursuant to the terms and conditions of a contract between licensees (or between a licensee and one or more customers), which includes methods and formulas that allow for the calculation of prices and tariffs. Notwithstanding this, in fixing or approving prices and tariffs, ZERA may differentiate between consumers based on differences in total electricity consumption, the time periods in which electricity is consumed, load factor, power factor, voltage levels, and other criteria that affect the cost of providing a service.

An aggrieved party may make an appeal to the administrative court. For the purpose of determining such an appeal, the administrative court may require ZERA to furnish it with:

• the reasons for the decision or action that is the subject of the appeal; and
• a copy of any evidence upon which the reasons are based.

Such an appeal must be made in the form and manner prescribed in the administrative court’s rules of court and within the period prescribed therein. For the purpose of determining an appeal, the president of the administrative court will be assisted by two assessors with ability or experience in the field of electricity. In an appeal, the administrative court may confirm, vary or set aside the decision or action appealed against, and may make such order as it thinks just (whether regarding costs or otherwise).

Prior to making an appeal as stated earlier, an aggrieved person may – within ten days of the rendering of ZERA’s decision or action – submit a request ZERA to reconsider some or all of its decisions or actions for the purpose of correcting a manifest error.

The basis on which the transmission service is provided is stipulated in the licence. Under Section 43(1) of the Electricity Act and subject to such terms and conditions as ZERA may fix in the licence, a primary transmission licence authorises the licensee to do any one or more of the following as may be specified in the licence:

• carry on grid construction and the operation and maintenance of transmission facilities within Zimbabwe;
• carry on the operation of an electricity power system, including but not limited to generation scheduling, commitment and dispatch, transmission scheduling and generation outage co-ordination, transmission congestion management, power pooling, international transmission co-ordination, procurement and scheduling of ancillary services and system planning for long-term capacity, and such other activities as may be required for the reliable and efficient operation of an electricity power system; and
• operate a power exchange, including:
1. energy accounting and settlement;
2. establishing and maintaining standards and protocols for the setting of electricity prices;
3. publishing prices and other market information; and
4. such other activities as may be required for a reliable and efficient power exchange.

Section 43(2) states that ZERA may require separate primary transmission licences to be issued in respect of the functions identified in paragraphs (a), (b) and (c) of subsection (1) if it determines that doing so is in the public interest.

Given the size of the market in Zimbabwe, it is most unlikely that many transmission licences will be issued. This is more likely to remain on an open-access and non-discriminatory basis.

The same regulatory authority and approvals mentioned in 3.1 Principal Laws Governing the Construction and Operation of Generation Facilities apply to the construction and operation of electricity distribution facilities.

The same regulatory process described in 3.2 Obtaining Approvals to Construct and Operate Generation Facilities and 4.2 Obtaining Approvals for the Construction and Operation of Transmission Lines and Associated Facilities applies to distribution facilities applications – although the required documents are:

• a map indicating the location of the distribution lines; and
• information relating to the distribution system, covering:
1. line specifications (capacity, voltage, length, conductor type, configuration, etc);
2. points of supply;
3. contractual arrangements – operations and maintenance;
4. metering arrangements and billing arrangements;
5. connection charges/agreements;
6. client services standards;
7. applicable tariffs;
8. a single line diagram;
9. transformers and transformer sizes;
10. proposed agreements for distribution network connections and use of the system;
11. an environmental and social impact assessment and Environmental Management Agency approval; and
12. the number and types of customers per voltage level.

There are no typical terms and conditions imposed on approvals to construct and operate electrical distribution facilities in Zimbabwe.

Rights to the surface of land are obtained by way of a lease agreement with the owner of such land, which could be a private entity, a municipality or a district council. The lessee pays rent to the landowner, which acts as compensation.

There are no monopoly rights to provide a distribution service within a specified geographical territory. Section 47(6) of the Electricity Act provides that “unless expressly indicated in the licence, the grant of a licence shall not hinder or restrict the grant of a licence to another person for a like purpose and in the absence of such express indication the licensee shall not claim any exclusivity”. However, ZERA may allow a licensed activity to be exclusive for all or part of the period of the licence, for a specific purpose, for a geographical area, or for some combination of the foregoing.

This falls under the purview of ZERA, as described in 4.6 Transmission Charges and Terms of Service. The same principles apply to electricity distribution system charges and the same rights are afforded to any aggrieved party.