Re-powering project faces hurdle

via Re-powering project faces hurdle | The Herald October 5, 2015

THE Indian Export and Import Bank has allegedly rejected a request from Jaguar Overseas Limited to provide a $70 million loan to finance Harare Power Station’s re-powering project.

Jaguar Overseas of India was contracted by the Zimbabwe Power Company to re-power the Harare station by replacing the old plant with a modern one with more capacity and efficiency.

Re-powering of Harare Power Station is scheduled to take 24 months and help ameliorate a prevailing crippling power crisis and grow the plant’s generation capacity to 120 megawatts.

The bank did not give reasons for rejecting the request for funding, but sources privy to the development said it might be that “Jaguar Overseas” is not in good standing with the bank.

A source said the Indian firm, awarded the engineering, procurement and construction contract to rebuild the plant’s generation capacity, is now in a quandary over the issue of funding.

“Adjudication for Munyati is underway and a decision will be reached soon, but India Eximbank has rejected a request to fund Harare re-powering; no reason was given,” a source said.

Efforts to get a comment on the rejection of the bid from ZPC had not been successful by the time of going to print on Friday.

Jaguar Overseas is allegedly now flirting with the idea of approaching Afreximbank, as an alternative source of funding, but faces another hurdle in the form of maximum project funding, since the bank can only fund to limit of $50 million.

The poser regarding funding for the station comes a few days after Energy and Power Development Minister Samuel Undenge expressed optimism about several quick win initiatives Government is pursuing to address shortage of power.

“There are quick win projects which are on the way to being implemented. These include: Harare re-powering project (at) $70,2 million with 85 percent of the cost promised by the India Eximbank,” Minister Undenge said on Wednesday.

Other re-powering projects for small thermals include Bulawayo where Government has secured an $87 million line of credit from the Government of India to add 60MW to the grid. Munyati re-powering has gone to tender and adjudication on the tenders is underway. Construction will take 24 months and this will add 70MW to the national grid once it is completed.Harare Power Station is located in the Workington area of the capital city. Station 1 was commissioned in 1942 and had a capacity of 21MW, but was decommissioned in 1970.

Station 2 had initial capacity of 75MW when it was commissioned in 1955, but it was de-rated to 20MW due to uneconomical units. It has nine chain-grate boilers and six turbo-alternators. Five boilers and three turbo-alternators have been decommissioned.

With a capacity of 60MW, the station’s plant 3 consists of pulverised fuel-fired boilers. The power plant also has two large turbo-alternator machines with capacity to produce 30MW each.

Currently, one of the plant’s turbo alternators is not in service as it awaits turbovisory equipment for it to return to service. According to ZPC plants 2 and 3 operate independently, but they are linked electrically through four interconnector transformers. Presently, the dependable capacity for plant 2 is 20MW and dependable capacity for Harare’s plant 3 is 30MW.

The re-powering project at the plant would see the replacement of the current boiler technology with a circulated fluidised bed, which is more efficient and cost effective. Early this year, ZPC engaged Namibia’s national power utility, NamPower, to secure a $250 million facility for the refurbishment of its three power plants, Harare, Munyati and Bulawayo. This came after NamPower earlier provided a $40 million loan to fund refurbishment of Hwange Power Station, in return for 100MW during peak and 150MW off peak over five years.

Government and private sector are pursuing several power projects across the country, including 300MW Kariba South and 600MW Hwange extension, to plug Zimbabwe’s over 600MW deficit. Demand for power reaches 2 200MW at peak period.