$649m boost for power projects

Source: $649m boost for power projects | Sunday Mail (Business)

Government plans to mobilise $649 million to support the implementation of several power projects lined up for next year, in a bid to ensure steady and affordable power supply.

A number of projects including the expansion of Hwange Thermal Power Station’s units 7 and 8; rehabilitation of Hwange Power Station, expansion of Kariba South Hydro-power Station, Gwanda Solar Energy Project, Tokwe Mukorsi Mini-Hydro Project and Kariba Dam Rehabilitation, have been lined up for next year.

The move is expected to ease power shortages, and more importantly, increase electricity generation by 14,6 percent in 2018.

This comes amid expectations that power generation and distribution will reach 7661 Giga Watts per hour by year end, representing an 8,1 percent growth this year.

In his 2018 Budget Statement in Parliament on Thursday, Finance and Economic Development Minister Patrick Chinamasa said, “The 2018 Budget will support this projected growth (of 14,6 percent), through mobilisation of $649,1 million for the sector and implementation of projects that will ensure security, stability, and affordability in energy supply, as outlined in the 2012 National Energy Policy.”

Minister Chinamasa said the growth in electricity generation is benefiting from increased water allocation towards electricity generation by the Zambezi River Authority.

This follows the surging water levels in Kariba Dam.

Currently, the Kariba South extension project – which is expected to feed 300MW into the national grid – is now at 92,3 percent completion.

The project is expected to be completed next year using Zimbabwe Power Company (ZPC)’s own resources of $20 million and $5,9 million from China EximBank.

The first unit that will feed 150MW to the national grid, is expected to be commissioned on December 24 this year, with the second unit also earmarked to come on stream by the first quarter of 2018.

In terms of the Hwange 7 and 8 expansion project, funding is expected to come from the China Eximbank any time from now after all conditions precedent were met.

Said Minister Chinamasa: “Once funding is secured, it is anticipated that $474,9 million will be drawn down, targeting main plant civil works, water treatment plant and down payment for electro-mechanical works, of which funding from China Eximbank is $310 million and Hwange Electricity Supply Company’s own resources, $165 million.”

The two units at Hwange will add 600MW to the grid.

The implementation of the Gwanda Solar Energy Project is also expected to resume next year following the granting of incentives to ZPC – the power generating arm of Zesa Holdings – to enable it to mobilise funds from the market.

About $66,7 million is set to be mobilised next year, focusing on construction of a 25 MW solar plant under Phase I of the project. At Hwange Thermal Power Station, $9,7 million has been set aside for the rehabilitation and maintenance works.

The exercise will be funded through direct Budget support.

Another key project expected to start next year involves works on the $19,1 million Alaska-Karoi sub-transmission network reinforcement.

The project is supported by the African Development Bank.

Minister Chinamasa said $15,4 million will be disbursed in 2018 for the project, whose works include a new substation at Karoi, the 85km distribution line, boreholes, storage tanks and pump facilities for surrounding communities around Karoi, Makonde and Hurungwe districts.

It is also expected that another $11,1 million will be disbursed under the Zim-Fund Phase II of the Emergency Power Rehabilitation Project for several energy projects including the transmission rehabilitation for Sherwood, Orange Grove, Marvel and Chertsey Substations; procurement of Gimboki sewage works 33kV line; and replacement of Turk Substation Transformer in Matabeleland North, Mpopoma 11kV switchgear & Hillside Road 11kV Board in Bulawayo and Stamford 33kV switchgear in Harare, among others.

Electrification of rural communities will be sustained through the Rural Electrification Fund (REF).

From January to September this year, 192 projects were completed, bringing the total coverage of targeted public institutions since inception of the Fund in 2002, to 5 579.

This represents 63 percent of the overall target of 8 878 institutions under the programme.

Next year, $36,5 million from REF is expected to target 706 rural institutions, installation of 50 stand-alone solar micro grid solar systems at public institutions and 16 biogas digesters.