MCCCI assesses blackouts cost

Malawi Confederation Chambers of Commerce and Industry (MCCCI) says it is yet to assess the cost of electricity on businesses pointing out that it is presently getting feedback from businesses.

MCCCI president Lekani Katandula said this in the context on the prolonged power cuts which according to some businesses are having a knock-on effect on businesses.

Katandula however indicated that the chamber only has qualitative feedback as the chamber is yet to complete a detailed survey on the cost of the electricity blackouts.

He said: “Currently, the chamber only has qualitative feedback from its members with no formal survey that has quantified the cost of capacity impacts which will be available in the coming months.”

Malawi is currently facing an acute power deficit following the damage of 130 megawatts (MW) Kapichira Hydro Power Station in January this year.

The situation has forced power utility supplier Electricity Supply Corporation of Malawi (Escom) to ration the available power to industries and households.

At the peak of the electricity crisis, some small-scale businesses have also indicated that electricity has become a top obstacle to doing business, thereby affecting their profitability.

 One such business is Press Bakes, owned by Rebecca Chinsima, who in an interview on Monday said her business is struggling to remain afloat due to prolonged power outages.

She said their output has been cut by about 65 percent as they close their business when power is not available.

Said Chinsima: “For us loss of production time means failing to supply some orders to customers. This automatically slows down the overall growth of the business, increases the cost of production resulting in low revenues.”

For Agness Madula, who runs her maize mill in Bangwe Township in Blantyre, the story is the same.

She said persistent power cuts have pushed her to borrow money to ensure that the business survives.

“The revenues I generate from this business have drastically reduced by 45 percent yet I have bills to pay at the end of the month.

“I have been forced to borrow money to settle bills yet I am running a business which is ideally supposed to be sustaining itself.”

Similarly, Peter Bottoman, who runs a similar business in Chilomoni said in an interview he is struggling to make ends meet as he is forced to halt operations because they cannot run without power.

Catholic University of Malawi economics lecturer Hopikins Kawaye described the current state of blackouts as having a huge adverse effect on the country’s quest to achieve the desired economic growth rate.

“For an economy to grow, power is critical and the current situation has affected businesses at all levels.

“Even small businesses are equally affected to the extent that small entrepreneurs have had their very lifeline cut,” he observed.

Meanwhile, the Ministry of Energy said the country needs about 618MW to power industries and households without load- shedding.

The projected demand of 618MW is against the current Electricity Generation Company’s installed capacity of 539MW and current supply of 280MW.