The tariff CEC pays for the power it sources from the national utility has periodically been revised upwards over the course of the supply agreement between the two. Contrary to claims that the tariff has remained low since 1997 and that retail customers pay more than the mines, and that CEC has received a disproportionate share of the mining power supply revenues.
Over the years, all stakeholders (mines, ZESCO, CEC, government) have come together with respect to achieving a mining tariff that is beneficial to the continued sustainability of both the power sector and the mines. Therefore, stakeholders successfully negotiated and implemented upward adjustment to mining tariffs of 35% and 28% in 2008 and 2011 respectively, guided by the Energy Regulation Board’s (ERB) Cost of Service Study of 2006. Another tariff increment was negotiated and agreed by stakeholders in 2017, achieving a uniform mines end-user tariff. Overall, between 2008 and 2017, the tariff increased by a factor exceeding 300%. These tariffs are not set by CEC but are an outcome of negotiation involving all relevant parties and regulated/approved by the Energy Regulation Board. The tariff structure has always been such that the larger share of CEC’s revenues from electricity sales to the mines is paid to its supplier, ZESCO. There is currently going on a Cost of Service Study to inform electricity pricing so that all electricity consumers at the various points in the value chain will pay tariffs that are expected to be cost-reflective. The study, being spearheaded by the regulator, is expected to be finalised by the end of 2020.