Zimbabwe’s industries are grappling with severe power shortages, which have hindered production and hampered the economy. As a result, many businesses are turning to solar energy as a viable alternative to keep their operations running. Particularly hard-hit is the heavy industry sector, where energy rationing has led to significant production gaps and financial losses, in some cases forcing companies to shut down.
In response to these challenges, companies with the financial capacity are investing in renewable energy sources. One notable example is the platinum group metals producer, Zimplats, which has allocated US$27 million of its US$37 million budget towards the construction of a 35 megawatt solar power plant. This initiative is part of a larger US$1.8 billion investment plan aimed at boosting energy self-sufficiency. The solar plant is expected to commence power generation by the end of May 2024 and is designed to help alleviate the strain on the national grid, which currently suffers from extensive power rationing.
The power rationing impacts various sectors of the economy, forcing both businesses and individuals to rely on expensive alternatives, like fuel-powered generators. Zimplats’ new solar facility spans 109 hectares and includes over 10,000 photovoltaic panels, capable of producing 550 watts per square meter, and is equipped with six inverters.
Beyond the solar project, Zimplats is also focusing on mine development and upgrades. The company is replacing production capacity from its depleted mines with new projects at Bimha and Mupani mines, with substantial investments totaling US$395 million. Moreover, the company is undertaking a smelter expansion and a sulphur dioxide abatement project, with US$340 million spent to date of a US$521 million budget.
Despite these ambitious projects, Zimplats is exercising caution with its finances due to lower global metal prices. The company recently reported a workforce reduction of 67 employees, representing 1.6% of its total staff, as part of broader cost-cutting measures. These efforts have helped reduce operating cash costs by 2% compared to the previous quarter, despite a 7% year-over-year increase.
Zimplats continues to prioritise efficiency, with operational modifications helping to manage inflationary pressures, particularly in electricity costs. Mining volumes have remained stable, with production increasing due to strategic pillar reclamation at the depleted Rukodzi Mine and ongoing development at Mupani Mine.
As the economic landscape shifts, Zimplats is positioning itself to not only navigate the challenges of today but to build a more sustainable and resilient operation for the future.
