Vedanta's Zambia unit says cost of electricity biggest challenge

LUSAKA (Reuters) - Vedanta Resources' Zambian unit Konkola Copper Mines (KCM) said on Thursday one of the biggest challenges it faced was the high cost of electricity in Africa's No.2 copper producer.

"One of the big challenges that we have for the future, for us to be able to stabilize our operations, is to have affordable power," KCM chief executive Steven Din said at a mining and energy conference in Lusaka.

"The other challenge that we have going into the future is just stable policies, whether its fiscal or regulations," Din said.

Din added that the cost of electricity had trebled over the last 10 years from what was envisaged when Vedanta invested in the country.

Zambia in April 2014 increased electricity prices by almost 29 percent for mining companies, a move the Chamber of Mines said was likely to hit mining operations.

KCM had a large power requirement as it operated one of the wettest mines and needed to pump out huge volumes of water. "That makes us the largest power user in the country, but despite that we actually pay one of the highest prices in the country," Din said.

(Reporting by Chris Mfula; Editing by Mfuneko Toyana and David Holmes)