Zambian mining companies agreed to reduce their electricity consumption by as much as 15 percent to help ease a power shortage in Africa’s second-biggest copper producer.
The local units of Glencore Plc, Vedanta Resources Plc and other operators reached the agreement with Mines Minister Christopher Yaluma and electricity supplier Copperbelt Energy Corp. at a meeting on Tuesday, according to the Chamber of Mines. Power cuts already enforced at projects run by First Quantum Minerals Ltd. and Barrick Gold Corp. will be reversed on Wednesday, said Jackson Sikamo, the president of the chamber.
“The discussion was very open and the minister acknowledged the effort the mining companies have made,” he said by phone on Tuesday from Kitwe, about 280 kilometers (174 miles) north of Lusaka, the capital. The reductions of 10 percent to 15 percent will “definitely affect production,” though it’s too early to tell by how much, Sikamo said.
First Quantum announced this week it would cut 1,480 jobs at a Zambian copper mine because the power limits had curbed its output. The company may reverse that plan now that an agreement has been reached, Sikamo said.
Low water levels have crimped hydroelectric supplies in the southern African nation and the power shortages will probably last until April, China Nonferrous Mining Corp., which has operations in the country, said in a statement last month.
Copperbelt Energy, which provides electricity to most mining companies, had planned on reducing supplies by about 30 percent from July 31. It abandoned that proposal after the government stepped in, citing the potential for job cuts.
Zesco Ltd., the state-owned utility, and Copperbelt Energy will present a plan on Thursday to import power and generate about 100 megawatts of electricity from temporary plants supplied by companies such as Aggreko Plc, Sikamo said. Companies will have to agree on a tariff to use this more expensive power, he said.
Copperbelt Energy will finalize a plan to import 150 megawatts to 200 megawatts, a memorandum on what was agreed to at the meeting showed.
Yaluma didn’t answer a call to his mobile phone seeking comment.
Zambia has an electricity shortage of about 560 megawatts because of low water levels at the hydropower plants it depends on for more than 90 percent of supplies, coupled with delays at new projects. The country’s normal generating capacity is about 2,300 megawatts, of which mining companies use more than half.