The Chamber of Mines of Zimbabwe is urging the government to release miners from ZESA power supply contracts. This would allow them to join the Intensive Energy Users Group (IEUG), as current tariffs remain too high for the mining sector.
By Ryan Chigoche
Since last year, the Chamber has raised concerns about rising electricity tariffs. Mining companies have seen rates jump over 44%, from US$0.0986 per KWh in 2022 to US$0.1421 per KWh in 2024.
This increase has put a lot of pressure on mining operations.
The situation is worse for energy-heavy industries like ferrochrome production, where electricity makes up about 50% of total costs.
At the same time, prices for key minerals have dropped sharply in the past two years. This combination has made many mines unprofitable, with some struggling just to break even.
In its report for the quarter ended April 2025, the Chamber repeated its call for miners to be freed from ZESA contracts. This would give them access to cheaper electricity options, such as through IEUG.
“The electricity tariff for mining companies remained high and unsustainable, impacting negatively on viability. Meanwhile, the Chamber has sought Government’s intervention in ensuring that ZESA releases mining companies from power supply contracts to allow them to access cheaper alternative power from platforms such as IEUG. Government has committed to assist on this matter and the Chamber will follow up on this matter.”
The Intensive Energy Users Group (IEUG) is made up of the country’s largest electricity consumers. These come mainly from the mining, manufacturing, and heavy industry sectors.
IEUG was created to give these users a united voice when dealing with utilities like ZETDC and regulators such as ZERA. The group pushes for stable, cost-reflective tariffs and reliable power supply.
For mining companies that depend on constant electricity, joining IEUG offers several advantages.
These include priority access during load-shedding, collective tariff negotiations, and a chance to influence energy policy. Members also work together on energy projects like solar power and wheeling, where a company’s self-generated power is sent through the national grid for use elsewhere.
However, companies still tied to ZESA supply contracts cannot join IEUG. Membership requires independent power procurement, such as buying from independent power producers or using embedded generation.
Companies must also have the necessary infrastructure, like dedicated feeder lines and smart meters.
