via Namibia to assist Zimbabwean power utility BDlive by Felix Njini NOVEMBER 07 2013
Namibia Power Corporation (NamPower) has said it will loan funds to Zimbabwe’s power utility to refurbish and raise generation capacity of two thermal power plants in return for guaranteed supplies of electricity.
NamPower had agreed to help upgrade the facilities to secure guaranteed electricity until 2018 when Kudu — a $1.2bn, 800MW gas-to-power plant it was developing — should start operating, MD Paulinus Shilamba said this week. He declined to say how much it would lend.
Namibia, the world’s biggest miner of offshore diamonds and the fifth-largest uranium producer, imported about 53% of its electricity needs from neighbouring countries, NamPower said in its 2012 annual report.
“We have identified an investment opportunity at the two power stations, which we also want to form part of our short-term critical supply project,” Mr Shilamba. “We have a strong balance sheet and are able to finance a deal of this nature.”
Zimbabwe Power Company (ZPC), the Harare-based electricity generation unit of the country’s Zesa Holdings utility, plans to raise generation capacity at the plant in Harare to 120MW from 50MW. It also aims to raise capacity at the plant in Bulawayo to 90MW from 30MW.
One megawatt of capacity is enough to supply 2,000 average European homes.
ZPC needed $180m to boost generation capacity at the two power plants, the company said. Zesa supplies about 1,100MW to Zimbabwe, about half the 2,200MW needed to avoid blackouts, it says on its website.
Preliminary investigations that NamPower had conducted showed the Zimbabwean “power stations are not in bad shape and with minimal investment can be brought into operation”, Mr Shilamba said. NamPower wanted the deal structured along a 2007 agreement under which it loaned Zesa $40m to refurbish four units at the coal-fired Hwange plant, securing supplies of 150MW over five years.
“Our deal with Zesa over Hwange power station is ending in 2014 and our expectation is that it should be the benchmark if we finalise an agreement to loan them money to refurbish the two stations,” Mr Shilamba said.
He would disclose how much power the Namibian utility plans to secure from Zimbabwe.
“It has to be a win-win deal for both of us,” Mr Shilamba said.
“If we invest money it means we expect to benefit.”