By Chantelle Muzanenhamo
The Zimbabwean government has announced a comprehensive review and major reduction of licences, permits and levies across the entire energy sector.
The decision, announced at a Cabinet meeting on Tuesday, is aimed at lowering the cost of doing business and could lead to reduced prices for consumers.
It follows a wider set of business reforms approved in July.
Information, Publicity and Broadcasting Services Minister, Dr Jenfan Muswere, confirmed the changes and said the review involved consultations with government bodies and industry stakeholders.
A major shift is the complete removal of the fee for a Solar Generation Licence.
“Among the reviewed levies, licences, fees and permits, the Zimbabwe Energy Regulatory Authority (ZERA) Licence application fee has been reduced from US$2 500 to US$2 000. The ZERA Solar Generation Licence of US$2 875 has been removed completely,” Muswere said,
Licences for fuel importers have also been cut.
“The ZERA Petroleum Import (Procurement) Licence of US$30 000 has been reduced by 50%,” he said.
The government is also targeting rural development and cleaner energy. Fees for selling fuel in rural areas and retailing Liquefied Petroleum Gas (LPG) have been lowered.
“The fuel retailing licence in rural areas has been reduced from US$200 to US$150. The LPG retail licence will be reduced by 50% from the US$230 that is currently being charged,” Muswere said.
Finance, Economic Development and Investment Promotion Minister, Professor Mthuli Ncube, linked the reductions to potential benefits for consumers.
“We expect these measures to have an impact on prices. The cost build up of these energy sources has to do partly with these regulatory fees. So if they are being reduced, the expectation is that the final product to consumers will also come down,” he said.
The government says the previous model for encouraging investment in the energy sector was no longer viable.
The new structure is expected to attract private investment.
The full schedule of revised fees will be published in the Government Gazette once legislative changes are completed.