12 IPPs now operational

Source: 12 IPPs now operational | The Herald April 14, 2017

Business Reporter
TWELVE independent power producers, out of a total of 30 IPPs licensed by the Zimbabwe Energy Regulatory Authority are now operational, but the regulator says it will not hesitate to revoke the licences where lack of progress is noted.

ZERA chief executive Gloria Magombo told The Herald Business in an interview that all licences to IPPs are issued with different conditions, which are evaluated on a quarterly and subject to cancellation if the conditions are not met.

However, prior to revoking licences of IPPs, where Zera would have noted lack of progress, as per conditions attached to the particular licence, the energy regulator allows the affected investor an opportunity to make representations.

Zera revoked licences of five IPPs last year, with some of the IPPs accused of holding on to their licences for speculative purposes.

Those that lost their licences allegedly failed to come up with integrated energy resource plans.

Engineer Magombo’s remarks come against general perception that some IPPs hold on to licences for purposes of speculation when the rationale behind issuing the licences is development of power projects to alleviate power shortages.

Some of the 12 that are now operational are Hippo Valley and Triangle with a generating capacity of 33MW and 45M, respectively and mini hydros in Honde Valley, Nyamhingura 1,1MW, Pungwe 2,7MW and Duru 2,2MW.

“We have issued 30 licences to IPPs and out of those 12 are now operational. What is important though is each licence is issued with its own condition, and it is those conditions we follow up on and evaluate every quarter. If it is noted that the conditions of the licence have not been fulfilled following an evaluation by the board, Zera will not hesitate to revoke the licence,” she said.

Eng Magombo said Zera will, however, allow operators time to fulfil certain procedural aspects, which may not be visible on the ground.

“There is a lot of work that has to be done like doing the feasibility studies, EIAs (Environmental Impact Assessment studies) . . . geotechnical surveys. So if even there is nothing on the ground, it may not mean that there is no progress.”

Government has taken the decision to promote investment in the energy sector by making IPP licences easily accessible as a deliberate policy thrust to address chronic power deficit, which cost the country millions through imports.

Zimbabwe has suppressed power demand of 1 400MW against internal generation capacity of about 1 100MW. The deficit is met through imports from the region, which is currently constrained by shortage foreign exchange.