Unstable Power Supply Effects On The Economy

Unstable power supply has a lot of effects on the economy. The effects are great with the stability levels.

Zambia has been facing a lot of challenges regarding electricity. The effects are however never addressed on the effects on the economy. I believe the issue should be addressed with full knowledge of the effects on lifestyle, economy, education, health, etc

Lack of Guaranteed and Stable Electricity

Without guaranteed and stable electricity, the economic stability of any country will be threatened. Is it no secret that Zambia has a shortage of power supply, resulting in continuous "load-shedding". Load-shedding is the cutting of electricity supply to some households in order to stabilise supply in other areas or sectors. The load-shedding has no specific time, bears no regard to what needs to be done and bluntly it is just applied. The worst part is that different areas experience different "load-shedding" levels and intensities and some never even experience it. You have to realize that when power supply is cut, all work, machinery or activities that depend on electricity will not be possible. The activities come to a stand still. 

For those with economic dependence on electricity will not perform their economic activities at the time of load-shedding. All possible economic activities in a particular area that depend on electricity die. That is the bottom line. You can actually witness the demand through the buying of generators, solar panels, etc. The sectors affected however, would not result in all of them depending on solar panels and generators. If this was the case, ZESCO would have been replaced by now. Few barbershops, entertainment places actually use these alternative sources even though they can easily provide for them.

Zambia's fight to increase entrepreneurship for the young people has severely been affected by lack of stable electricity. Few would venture into it without regarding power. It is assumed the load-shedding is only applied to residential areas, but how many businesses start up in residential areas? Even big multinational companies started in one's garage. It should be appreciated that some economic activity depend on electricity and it would help if we had stable electricity supply for our economic benefit.

Therefore, lack of stable electricity in Zambia has produced a lot of negative effects on the economy. The effects are far reaching and need to be addressed. The cost of this unstable supply of electricity should be regarded as the cost of downtime during an outage which would include but not limited to the opportunity cost of economic activities that would otherwise be carried out. Further social, medical, psychological costs in terms of injuries, deaths resulting from lack of power, failure in advancement in education due to failure to study. Any other costs from the lack of power should be included in the cost of unstable power in order to assess the full impact of unstable power supply. 

Cost Reflective Pricing

I have always loved the terminology used by ZESCO/ ERB, etc in justifying an increase in prices or fees. So what is the cost reflective-ness that is always being talked about? Do we really have different costs for companies and residential clients?

We have to take on board the feeling that people have of the big companies not paying their fair share of the costs of electricity. This has to be confirmed to each and every stakeholder. We feel we pay our share and even subsidize the big companies. Bluntly speaking, the cost reflective-ness for the two (residential clients and companies) cannot be the same in actual terms, I believe one should be greater than the other.

In this light then, cost reflective-ness though welcome, needs to be explained to us. We always feel we pay a lion's share of the cost.

Change Our Business Timings
We should remember that cutting of electricity supply comes with risks. In particular, health related institutions like hospitals and mining entities.

Therefore, we are left to cut power supply in areas with minimal side effects. Households pose a good group of people who should be cut from supply. But I tend to think they are also the group which uses it less compared to those that are using it in manufacturing. 

To this effect, we should ensure that the big electricity consuming companies also do their fair share of the "load shedding" by working at times that households do not use. That will be a fair way of sharing the limited resource.

All in all, unstable power supply has a lot of effects on the economy and should be looked at with the seriousness that it deserves. We as a country need to appreciate that we can only do so much when we have enough power. Self employment opportunities should be addressed in full. There is no need to look elsewhere when we can provide these opportunities. The cost on the economy are not measurable.