US$396 million for Zambian hydro power

President Levy Mwanawasa said last week (February 6) in Ndola that the Exim Bank of China has agreed to give Zambia the loan to be used in improving the country’s main power generating company.

Under the hydro project, Mwanawasa said the Zambia Electricity Supply Corporation (Zesco), the country’s power utility company, would partner with Sino-Hydro, a Chinese company to expand Kariba North Bank.

The managing director of Exim Bank is already in Zambia holding talks with the Zambian government and Zesco on how the project will proceed.

Mwanawasa said, ” the project has been standing for a long time and I had a meeting with the managing director of Exim Bank who is in the country. I was with him and he is having meetings with Zesco management”.

The expansion of the hydropower infrastructure Mwanawasa said would therefore be relevant to satisfy the Country’s needs as well as exporting to neighbouring southern African countries where the demand for electricity is very high.

Zambia currently exports power to South Africa, Namibia, Zimbabwe and the Democratic Republic of Congo (DRC), which earns the country the much-needed foreign exchange (forex). Zambia and Zimbabwe share electricity infrastructure at Kariba North Bank.

Last year, Zesco signed a contract with the cash strapped Zimbabwe Electricity Supply Authority (ZESA) for the supply of electricity to the later.

The contract allows Zesco to supply 100 megawatts of electricity to ZESA during off-peak periods that is between 23:00 hours PM and 06:00 hours PM. The contract was signed to offset crippling electricity shortages in Zimbabwe.

Additionally, Zimbabwe imports 15 per cent of its power from South Africa’s Eskom. Zimbabwe also imports power from Mozambique and the DRC.

Zambia is already working on improving Kafue Gorge Lower power station with the financial assistance from Sinohydro. The project is estimated to cost US$ 600 million.

The Chinese government has also promised Zambia that additional funds will be released for the development of other hydropower stations including Northwestern hydro project.

Just last month, Zesco and TATA Africa Holdings, an Indian company launched a partnership pact for the construction of yet another hydropower station in Itezhi-Tezhi on the Kafue river worthy US$150 million.

The project is aimed at mitigating the anticipated power shortage in Southern Africa next year.

Energy and Water Development deputy Minister Gaston Sichilima said the looming power shortage in the region was a matter of concern and the Itezhi-Tezhi power project would facilitate the expansion of Zambia mining and agriculture industries.

The Itezhi-Tezhi power project is supposed to be completed in three years from this year.

Zesco Managing director Rhodnie Sisala and TATA Africa Holdings managing director Raman Dhawan said the current projections indicate that Zambia and southern Africa would have power shortage next year hence the need to avert the looming shortages by embarking on electricity projects.

The Itezhi-Tezhi power project is the largest single venture that the Indian company would be undertaking in Zambia, according to the Indian High Commissioner to Zambia River Wallang.

February 2007
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