CEC unhappy with declaration of its Power infrastructure as common carriers

The Copperbelt Energy Corporation (CEC) says government’s decision to declare the company’s power infrastructure as a common carrier has the full effect of taking away its commercial and property rights.
CEC Senior Manager Corporate Communication Chama Nsabika says this will also completely prevent the Company from taking viable business decisions, including enforcing its legal and commercial rights in the best interest of the business.
Ms. Nsabika adds that CEC observes that the declaration came few hours before the expiry of CEC’s power supply agreement with Konkola Copper Mines (KCM), which took effect at midnight on 31st May 2020 and in the wider context of the failed negotiations for the renewal of the Bulk Supply Agreement between CEC and ZESCO, which expired on 31st March 2020.
“CEC has become aware of Statutory Instrument No. 57 of 2020 (SI 57) issued by the Minister of Energy, Honorable Mathew Nkhuwa, declaring all of CEC’s distribution and transmission lines as Common Carrier.”
“Both KCM and ZESCO are, as of now, effectively controlled by the Government of the Republic of Zambia,” Ms. Nsabika says
She has urged Investors to note that the company will in the meantime, engage in dialogue with government in the hope of obtaining an amicable and equitable outcome targeted at restoring CEC’s commercial and property rights.
“CEC takes this opportunity to advise all its investors of these actions from the GRZ that are highly detrimental to the well-being of the business and its ability to continue as a going concern,” she stated.
Early this week, Minister of Energy Mathew Nkhuwa signed Statutory Instrument No. 57 of 2020 declaring all of CEC’s distribution and transmission lines as Common Carrier.
According to the SI, the Transmission and distribution lines are declared as common carrier for the purposes of the Act and shall be used on the terms and conditions determined by the Energy Regulation Board (ERB).
There has been a two-year impasse over the renewal of Bulk Supplier Agreement (BSA) between the CEC and ZESCO. ZESCO and its biggest electricity off-taker, Copperbelt Energy Corporation PLC (CEC), have failed to reach an agreement on the renewal of the Bulk Supply Agreement.