ZESCO, ERB SIGN NEW KPI FRAMEWORK AMIDST MARKED PERFORMANCE IN 2021 AND 2022
The Energy Regulation Board (ERB) says ZESCO Limited has in the past two years made considerable progress to attain the set Key Performance Indicators giving confidence that it would eventually attain the set performance mark of 75 percent.
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ERB Board Chairperson, Mr. Reynolds Bowa made his observation at the signing ceremony of the new Key Performance Indicator Framework for the period 2023 to 2025 held on 29 July 2023 at the ERB Head Office in Lusaka. The KPI Framework is the 6th for the Corporation and the first for the current Corporate Leadership Team.
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“A score of 37 percent in 2020. A score of 46 percent in 2021, and a score of 49 percent in 2022. So, in the last three years, there was a failure to attain the minimum benchmark against these KPIs. What should be noted for our own interests as consumers is that although this is a failure, it does represent steady progression. The worst of those numbers is in 2020. 2021 was better; 2022 was even much better, and our own expectation is that 2023 will hopefully not be a performance below the benchmark but one that is above.
“We always like to think of ourselves as regulator rather than a policeman. It is in our interest to ensure success and we support success rather than aspiring to punish failure,” Eng. Bowa said.
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According to the Chairperson, ZESCO had scored 43,25 percent in 2021 and 48.58 percent in 2022 signaling a steady and encouraging improvement.?
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With the new framework in force, the ERB’s approval of tariff adjustments, as per the multi-year tariff regime approved in May 2023, will be conditional and subject to ZESCO attaining the set KPIs.
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The KPI framework is composed of 11 thematic areas being: new customer connections; postpaid billing; financials; efficiency; system losses; staff productivity; quality of service; power generation; safety; customer service; and power quality.
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Within the new KPI Framework, ZESCO is compelled to embark on initiatives that will increase efficiency by reducing energy losses, operational costs, optimising debt collection, utilisation of power plants, monitoring, and installing power quality monitors.
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The signing of the KPIs is in conformity with the Energy Regulation Act number 12 of 2019 and the Electricity Act of 2019, which mandates the ERB to undertake operational performance monitoring of enterprises in the Energy Sector.
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ZESCO Limited Board Member, Mr. Charles Kaisala assured the Corporation’s customers and all of its stakeholders that the signing of the KPI Framework was a binding agreement of an accountable and transparent service provider committed to deliver quality services.?
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Mr. Kaisala confirmed that while the ERB had in May 2023 approved a multi-year tariff regime for a five-year period (2023 – 2027), the tariff adjustments were conditional and subject to ZESCO meeting the set operational and commercial performance indicators.
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The Board Member said that considering that ZESCO’s areas of strategic focus contained in its strategic plan for the period 2022 – 2023 to a large extent mirrored the KPIs, the Corporation was incentivized to ensure it successfully attained the KPIs and avoided the associated penalties.
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He assured that the framework would enhance what ZESCO had to achieve in its strategic plan as it would act as a catalyst to accelerate the achievement of the Company’s objectives.
” In the new framework, ZESCO will be penalised for poor performance. I assure the regulator, that ZESCO cannot afford to be non-compliant; it is in its best interest to comply with all 11 thematic areas of this new framework.
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On a quarterly basis, ZESCO’s performance will be evaluated across the 11 core business areas.