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Energy & Water
facility worth more than US$ 200 million to contribute
to poverty alleviation and protection of the environ-
ment under the Millennium Development Goals. The
ACP-EU Energy Facility has been funded under the
10th European Development Fund and covers the
period of 2009 to 2013.
The Zambian power sector is governed by three
pieces of legislation:
• The Energy Regulation Act (1995) established the
Energy Regulation Board (ERB)
• The Electricity Act (1995) abolished the statutory
monopoly of ZESCO in the power sector and pro-
vided room for new entrants
• The Rural Electrification Act (2003) aims to facili-
tate expanded electrification in rural areas
The ERB is responsible for the licensing, monitoring
and supervision of operators in the energy sector,
as well as the approval of electricity tariffs. In con-
sultation with other statutory bodies like the Zambia
Competition Commission, the board monitors and
promotes competition within the energy sector, while
simultaneously minimizing the environmental impact
of the production and supply of energy and the stor-
age and use of fuels in conjunction with the Environ-
mental Council of Zambia.
The power distribution network falls under the Zam-
bia Electricity Supply Corporation (ZESCO), the
national electricity utility, which was successfully
commercialized in 2005. The corporation operates
and maintains a high voltage transmission system,
is responsible for all electrical power imports and ex-
ports in the country, and provides retail services to all
but the largest mining customers in the Copperbelt.
Zambia experienced energy shortages during 2007
and 2008 when demand rose due to increased
ZESCO has made great strides to reduce the back-
log of customers waiting for new electricity connec-
tions. Generally, a standard connection is completed
within 30 days and a non-standard connection within
90 days. For non-standard connections the backlog
has been reduced from 7,000 in January 2008 to
3,600 in January 2010.
In an effort to sustain existing capacity as well as to
attract additional investment in the sector, electricity
tariffs have been raised marginally. The government
has approved a new multi-year tariff adjustment
framework in 2009, which is aimed at inducing op-
erational efficiency and increasing the profitability of
the sector. In addition, ZESCO has embarked on a
countrywide programme to install prepaid electricity
metres, most of which are now locally manufactured.
The public utility is also in the process of improving
its cost structure for the benefit of its customers.
The Copperbelt Energy Corporation (CEC) is the
sole distributor of electricity to the major mines
in Zambia. Currently, CEC buys electricity from
ZESCO under a bulk supply agreement that will ex-
pire in 2020, at which point the opportunity to supply
energy to the largest industry in Zambia will become
open to re-negotiation.
Opportunities for investment exist in electricity gen-
eration and transmission projects, as well as the ex-
ploration for, and production of, petroleum resourc-
es, coal, exploration mining, and the development of
renewable energy sources.
ELECTRICITY GENERATION AND
SUPPLY
CURRENT INFRASTRUCTURE
DEVELOPMENT
Kafue Dam electricity lines
ZESCO Calzone crane in the water at the Kafue Gorge