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The Private Sector Development Association (PSDA) has raised alarm over the recent adjustment of electricity tariffs by the Energy Regulation Board, asserting that the hike will lead to increased production costs for manufacturers, which are likely to be passed on to consumers.
PSDA Chairperson, Yusuf Dodia, expressed concern that the tariff increase, approved to help ZESCO address a significant 2,000 megawatts electricity deficit and to support industries such as mining and large businesses, will negatively impact ordinary Zambians.
“While the increase may assist in addressing the power shortage, higher tariffs will strain household incomes, as people will pay more for electricity while also facing rising commodity prices,” Dodia stated in an interview in Lusaka on Monday.
Dodia acknowledged that the emergency tariff increase is a necessary temporary measure, expected to last a few months until the rainy season.
He remained hopeful that improved rainfall would enable power stations to resume full capacity and help alleviate the electricity deficit.
However, he cautioned that any reversal of the tariffs would hinge on favorable weather patterns.
“If rains remain insufficient, further tariff increases may be unavoidable,” he warned.
In light of the potential economic strain, Dodia has urged the government to consider implementing measures aimed at mitigating the impact of the tariff hike on both businesses and consumers.
He emphasized the need for strategic interventions to support households and industries during this challenging period.
The PSDA’s call for action highlights the broader implications of the tariff hike on Zambia’s economy, emphasizing the importance of balancing the need for energy supply with the economic realities facing consumers and businesses alike.
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