Blackouts push up production costs

Post was last updated: September 20, 2017

Industry captains have lamented the resurfacing of power blackouts which they claim have pushed up production costs by 20 percent.

Some campanies said the situation is forcing them to scale down production as the diesel generators they have resorted to for energy are costly to run and maintain.

Nampak Malawi Managing Director, Simon Itaye, said that the problem has also affected the company’s production schedules as the company is forced align its production to Electricity Supply Corporation of Malawi’s (Escom’s) schedule.

“It’s becoming very costly, especially here at the Makata Industrial Area. We are having blackouts every Monday and Tuesday, so what that means, is for about eight to 12 hours we have to use our diesel generators,” Itaye said.

He further said the diesel generators the company uses do not have capacity to power the whole factory which has forced them to ration usage of machines.

He further lamented the Maximum Demand Tariff, which they pay to Escom regardless of availability of power or not.

Plascon Paints Chief Executive Officer, Arthur Chirwa, agreed with Itaye stressing that their company’s cost has increased by more than 10 percent owing to the persistent power outages.

He said the problem stems from a lack of implementation of strategies to address the problem, which in turn, reflects on the economy.

“The biggest problem that we have as a country is that we fail to implement what we agree to do. I remember there was talk that government is going to bring diesel generators to minimise the impact of the blackouts but up to now, those gensets are nowhere to be seen,” Chirwa said.

He further said the situation is likely going to affect the performance of the economy.

Escom was yet to respond to our questions when we went to press but during a familiarisation tour of its operations for newly appointed Minister of Energy, Aggrey Massi, Escom indicated that generation capacity has gone down by 19.3 percent.

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