Source: ZPC targets funding deal by March 2017 | The Herald December 28, 2016
Business Reporter—
THE Zimbabwe Power Company expects to reach financial closure for the $1,5 billion expansion of Hwange Power Station by March next year, managing director Engineer Noah Gwariro has said.Eng Gwariro said that considerable progress has been made towards fulfilling the conditions for the Hwange expansion project.
The loan agreement between the Government of Zimbabwe and Exim Bank of China was ratified in Parliament on the 7th of December, he said in a January to November 2016 performance update.
A limestone supply agreement between Hwange Electricity Supply Company, a special purpose vehicle for the Hwange expansion project, and PPC was signed on the 8th of December 2016.
“ZPC expects to reach financial closure for the Hwange expansion project by the end of March 2017,” Eng. Gwariro said.
Chinese firm, Sino Hydro, was awarded the contract to expand Hwange Power Station’s production capacity by 300 megawatts. It also won the contract to extend Kariba South power station.
At best, the Hwange power station currently has capacity to generate 480 MW. The power plant had installed capacity for 920 MW, but part of it is depressed as most of its generators are old.
Local works for the Deka project are 85 percent complete. Exim Bank of India has appointed an Independent Consultant to assess the cost of the EPC works. Meanwhile, prequalification documents for the EPC works are under review by Exim Bank of India.
The Deka pipeline project will result in increased water carriage capacity required for power generation at the Hwange thermal power station.
Ongoing projects around Hwange power station are aimed at increasing local power generation, which stands at about 1 000MW against demand for power, at peak periods, of 1 400MW. Power utility, Zesa, uses imports to cover the power supply deficit. Government, through Zesa, is working on several initiatives across Zimbabwe; targeting excess power generation by 2018.
A total of 6 282GWh of energy was sent out against a target of 6 757GWh for the period January to November 2016. The cumulative energy sent out is trailing the target for the period by 7 percent.
To that end, the Kariba South Extension project has made remarkable progress from 58 percent in the previous quarter to 66 percent towards completion in the fourth quarter of this year.
Extension of Kariba South’s will extend the plant’s capacity by 300MW.
The engineering feasibility study for the Batoka hydro power project are almost complete, and the draft final environmental Impact Assessment study report was submitted and is under review.
Eng Gwariro said that drafting of the power purchase agreement for the Gairezi 30MW hydro power project is in place, having completed the environmental impact assessment report.
The geo-technical survey fieldwork for the Mutare peaking power plant project was completed and compilation of the report is in progress.
COMMENTS
The Kariba South Bank Power Station was designed to use the full winter flow of the river. With the North Bank Station now also taking this amount of water good annual rainfall is already a critical requirement if both power stations are to operate at full capacity. With climate change the Chinese South Bank 300MW extra capacity is likely to become a white elephant.
The increased annual rise and fall of water level in the dam caused by this extra usage will contribute to the geological instability of the area due to varying pressure on the earths crust, even more so if another dam is built at Batoka. The wall will be more at risk.