Lusaka, Zambia — MININGREVIEW.COM — 20 September 2010 – Zambia “’ Africa’s largest copper producer “’ has started negotiating higher electricity prices with foreign mining companies.
Energy minister Kenneth Konga told a news conference here that state power utility Zesco Limited was currently in talks with mining companies over higher prices, but declined to say how much.
“It is in the interests of the mines as well that the cost of power goes up, because there will be no electricity if the country does not invest in new generation facilities,” he explained.
Zambia has said that it plans to raise electricity prices to cost-reflective levels by 2013 to help fund investment in new power generation facilities.
Foreign mining companies operating in Zambia include Toronto-listed First Quantum Minerals and Equinox Minerals, London-listed Vedanta Resources, Glencore International AG of Switzerland and South Africa’s Metorex Limited.
Copperbelt Energy Corp. (CEC), the main supplier of power to the mines, has an agreement with Zesco that provides for yearly tariff hikes to cover inflation. A CEC official said in July that companies operating older mines might be forced to shut down some of their operations if Zesco raised the tariffs beyond the hike to cover inflation.