Zimbabwean government to allow private investment in energy sector

16:53, July 28, 2010      

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Zimbabwe will soon open up its doors to investors in the energy sector to invest as independent power producers or public-private partnership arrangement in the development of larger power projects in the country, The Herald said on Tuesday.

The country's energy sector, which produces about 1,100 megawatts of electricity on average, with a peak demand of about 2, 100 megawatts, and imports between 300 and 500 megawatts mostly from Mozambique and Zambia, faces serious challenges, which have a negative impact on economic development.

President Robert Mugabe recently said erratic power supplies are affecting economic development.

He said the government is working on a number of initiatives aimed at easing the situation that has negatively affected capacity utilization in industries.

"Persistent erratic power supply remains a potent threat to the successful turnaround of the economy. However, the government is working on initiatives which would see a gradual easing of the situation," said the president.

The Zimbabwean government is currently working on the refurbishment of the coal-fired Hwange Power Station, where five out of the six units are expected to become operational by the end of this year.

Power generation at Hwange will be expanded by 600 megawatts and the Kariba hydropower station by about 300 megawatts.However, there is huge further potential to expand power generation capacity through hydropower projects, which could deliver an additional 5,000 megawatts.

Other smaller hydropower projects that can be constructed near small rivers and dams could add more than 200 megawatts to the country's generation capacity. The government had earlier indicated that they are looking for IPPs to help develop or to set up these projects, saying that producers did not necessarily have to export the power to the national grid.

IPPs would also be allowed to sell their power to other electricity users in the country.

Other options for expanding the power generation capacity of Zimbabwe include the country's coal-bed methane reserves of about 1.1 trillion cubic feet, as well as its 11.8 billion metric tons of coal.

The Bulawayo Thermal Power Station, which has not produced electricity for nearly a decade will soon be resuscitated in a deal with the Botswana Power Corporation (BPC). BPC has agreed to inject 8 million U.S. dollars in to the project.

Mugabe also noted that the use of renewable energy sources such as ethanol blending would also be promoted to ease power demands. He said these measures need to be complemented by implementing demand-side management measures and the promotion of efficient use of energy.

In line with these measures, the Zimbabwe Electricity Supply Authority is working on the installation of prepayment meters to help in billing and revenue collection.

The Energy Regulatory Bill, which seeks to establish an Energy Regulatory Authority to regulate the energy supply industry would be tabled in Parliament during the current session.

Source: Xinhua


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