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SUSTAINABLE ENERGY REGULATION AND POLICYMAKING TRAINING MANUALpage 9.110considered, especially for water pumping, electrifying village communities andrefrigeration in health clinics. The main constraint is the initial investment cost,which is quite prohibitive. The other form of renewable energy source is windpower. Today in Zambia its use is basically limited to water pumping.Wood fuel and charcoal are estimated to meet the energy needs of about 70 per centof the rural and urban population. The copper mines utilize nearly 2000 tons ofcharcoal annually in the refineries.Petroleum is not indigenous to Zambia. This has to be imported as crude andrefined into petrol, kerosene, diesel, aviation gas, and heavy fuel oil. Petroleumhas to be imported at international prices, transported through a 1500 kmpipeline to the refinery in Ndola. The refinery has a processing capacity of 1.0 milliontons per year.
MODULE 9: RENEWABLE ENERGY: REGULATORY AND POLICY OPTIONSpage 9.1112. ENERGY REGULATIONThe current institutional and legal framework for the energy sector is a result ofthe liberalization and reform process that started with the first ever NationalEnergy Policy, released in 1994 (NEP1994). The Government’s liberalization of varioussectors of the Zambian economy at the beginning of the 1990s was the maindriving force of the reforms in the energy sector. New laws, namely the EnergyRegulation Act (1995), the Electricity Act (1995) and the Rural Electrification Act(2003) were enacted to facilitate liberalization and to ensure consistency of theenergy sector with other sectors.The Energy Regulation Act provides for the establishment of the sector regulator,the Energy Regulation Board (ERB), and defines its functions and powers. TheERB is the sole licensing authority for operators in the energy sector and isresponsible for close monitoring and supervision of such operators. The ERB isalso responsible for monitoring the level and structure of competition, marketentry issues (i.e. the ease of market entry) and investigating and remedying consumercomplaints. In order for the ERB to execute its mandate, the Board workswith other statutory bodies such as the Environmental Council of Zambia, theZambia Competition Commission and the Zambia Bureau of Standards. Thistherefore means that the legal and regulatory framework of the power sector alsoneeds to recognize the legislation of these institutions namely: the Environmentaland Pollution Act, the Zambia Competition Commission Act and the ZambiaBureau of Standards Act.The Electricity Act provides the framework within which the electricity sector willoperate. It abolished the statutory monopoly that the state-owned utility ZESCOLimited had enjoyed in the electricity subsector and provides for new entrants.The act sets out the rights and obligations of the electricity supply companiesand those of the consumer.The Rural Electrification Act established the Rural Electrification Authority, aninstitution responsible for implementing rural electrification, as well as definingits functions and establishing the Rural Electrification Fund.Furthermore, a new awareness of the integrated nature of energy in economicdevelopment has prompted the review of the existing policy and the formulationof the 2005 National Energy Policy (NEP2005). The NEP2005 sets out theGovernment’s intentions in the energy sector, these being aimed at ensuring thatthe sector’s latent potential to drive economic growth and reduce poverty is fullyharnessed. The NEP2005 is still under consideration by Government.
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