Date:
November 21, 2024
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CEC 23rd Annual General Meeting Management Presentation
Business Environment Highlights
Sovereign Default
- Default is continuing.
- Zambia looking forward to IMF program.
- Both IMF and the GRZ have indicated negotiations are progressing well so far.
Power Situation
- Supply gap of up to 850MW during the year.
- Non-mining customers loadshed to manage supply gap.
- Mining customers received full power to mitigate economic impact.
- Situation has significantly improved.
- Impacted on improved liquidity.
Strengthening Commodity Prices
- Bullish Chinese demand.
- Favorable supply side.
- Support for green economy.
Contractual Matters (CEC/ZESCO/KCM)
- Discussions on contracts to underpin power supply, domestic wheeling, and international wheeling arrangements yet to be agreed with ZESCO.
- Network access arrangements with KCM pending as well.
- CEC continues to prioritize these matters.
Financial Performance
KCM Payment Default
The payment default continued in 2020 resulting in an increase in debt to USD153.1m. However, the risk arising from this growing debt was partially mitigated by the shift of the KCM’s load from power supply to transmission use of system (TUoS).
Power Supply Agreement
No replacement agreement has been put in place for the expired BSA yet. Despite this, the parties agreed to ensure uninterrupted supply to the Copperbelt customers.
Use of Network Agreements
TUoS agreements are not concluded. Negotiations will continue in 2021 to ensure conclusion of all key agreements that underpin CEC’s operations.
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