The Southern African Power Pool (SAPP) was created with the primary aim to provide reliable and economical electricity supply to the consumers of each of the SAPP members, consistent with the reasonable utilisation of natural resources and the effect on the environment.
One of its main objectives is to provide a forum for the development of a world class, robust, safe, efficient, reliable and stable interconnected electrical system in the southern African region.
In its endeavour to contribute to ensure that the Southern African region is the region of choice for investments by energy intensive users, The Southern Times- the prime regional newspaper felt obligated to seek the opinions of leaders in the energy sector about challenges and achievements that have thus far been attained.
In this interview our Senior Writer Lovemore Ranga Mataire recently had a conversation with Zimbabwe’s Minister of Energy and Power Development Dr Samuel Undenge (S.U) on a number of issues concerning the Southern Africa Regional Power Pool.
L.R.M: The Southern African Regional Power Pool remains a noble initiative born out of the need to share electricity in times of distress. In your view has this vision lived to your expectations?
S.U: I think in many respects yes. In first instance there are now interconnections within the region and we are now able to bail each other out by way of utilities. We however still have other countries not connected one or two countries not connected to the power pool and Malawi is a case in point and that process is well under way. I believe the other country is Tanzania and possibly Angola but the rest of the region is interconnected. There may be questions about the current capacity of the interconnections but nonetheless we are connected. There is a downside to the interconnection which is that sages from one country. Nonetheless on the positive side is that we are interconnected, we are able to share and we do share and bail each other. And of course there are initiatives to improve on the interconnections such as Sizabona and the proposal to further link Mozambique, Zimbabwe and South Africa and such an agreement has already been endorsed by the respective ministers of the three countries.
L.R.M: So in summary you are a bit contented on the progress made so far?
S.U: Yes in terms on of mutual support and physical support on the ground I think we can only improve on it, the groundwork has been set. And of course from the point of view that besides bilateral arrangements that exists between countries and between utilities on energy sharing, we have established a short term market in the energy sector such that utilities are able to buy excess electricity from any of the other utilities in terms of day ahead, week ahead and month ahead and that market is working very well. It turns to be a surprise to many that the energy sector has its own stock market of sorts.
L.R.M: One of the objectives of SAPP is to ensure that the region becomes the region of choice in terms of investments by intensive energy users or investment in general. How far has SAPP attracted such investments?
S.U: It’s very difficult to say. As you are aware from 2007 the region was short of power. This of course has been predicated which meant the year leading to 2007 there must have been skepticism on the part of investors because they could see that the region was to be short of power. We are slowly emerging out of the shortage and as we emerge from the shortage one certainly will anticipate that investment will improve. But in terms of investments in the sector, yes there has been investment. You talk of the Kariba expansion and also the Zambian side’s expansion. In Botswana there have been difficulties there at one of their power stations in that the contractor was not supervised such that when the plant was said to have been completed instead of operating at 85- 90 percent it was way below. They have had to rethink as to whether the plant needs to be overhauled or not. In Zimbabwe we have had investments in Kariba; we are anticipating financial closure in terms of Hwange. We have had investments in terms of emergence plant in Dema and one can say more about investments in Zambia, Kariba North in Kafue, the PPP that they have in the southern province using coal and a number of IPPs (Independent Power Producer). So in the energy sector, certainly there has been a positive response with virtually each country vying for self-sufficiency in terms of energy or power generation.
In South Africa, their experience in terms of renewable energy particularly power and wind is now deemed as best practice example and many other regions are following the South African example of auctioning sites for renewable energy. So there has been appreciable investments since 2007 but unfortunately the tell tale signs that were given by people in the sector were not heeded at the appropriate time. It was established way back in 1998- 200 that the region will be short of power. But it was kind of that the powers that be disbelieving that prediction. I speak in terms of Zimbabwe; we were experiencing adequate power, cheap power at that, at 2-3 cents per kilowatt hour at Kariba. We were in our comfort zone until blackouts started hitting us then did we react or respond. I am saying had we reacted as the region in good time based on the projections that were made we would certainly have seen more investment than we have experienced simply because the first half of the first decade of the century we were inactive.
L.R.M: But what is Zimbabwe currently doing in terms of investing in other alternative energy sources? You have mentioned South Africa’s initiatives in renewable energy like wind and solar.
S.U: Primarily we don’t have much by way of wind. We have taken a study and realised that we have potential wind in the Eastern Highlands and in the area between Gweru and Bulawayo. But our focus is primarily on solar. Unfortunately, solar is not available during either the morning peak or the evening peak. Equally, until recently solar have been very expensive than hydro and thermal, our two major forms of power and the other challenge is the state of our grid. Solar does fluctuates as it is generated as a cloud passes, you can lose 20 percent of your generation. And you need to be able to cover that 20 percent loss instantly. As it fluctuates it should not impact on the grid unless you are talking of off grid solutions. And in terms of those we have quite a number at schools, at clinics and the Rural Electrification Fund is spearheading that programme, NGOs are spearheading that programme, we have one big off grid solar solution implemented and its supplying energy to two irrigation schemes as well as a number of schools in the area. But in terms of formal schemes that feed into the greed we have so much interest now and we can hardly cope in terms of interest. But on the part of government we have the three plants we are going to take- Gwanda, Sukhamini and Munyati 300 mega watts each. With Gwanda, perhaps the most advanced in terms of preliminary work having been done. You may have read in the media they got their environmental impact assessment certificate early this week, which means now we are now certain they can move in and start working.
L.R.M: What will be the impact of having those three solar power plants being operational?
S.U: Well, if you add 100 mega watts on to the grid it’s a significant impact. We seeing it as assisting us in managing the hydro power station at Kariba in the sense that I have already indicated that solar is available during the day largely during off peak. In which case to the extend technically feasible we would revert back to solar during off peak and reduce generation in Kariba and save water, which will then peak up periods.
L.R.M: What necessitated the change from cooperative to competitive power market?
S.U: I think the fact that power or energy is a strategic service and in fact it’s a security service. There is a limit that you can rely on your neighbor on matters that are strategic to you; on matters that of s security nature to you and energy is one such. Let’s just take an example and put power aside. Let’s take the example of petroleum. Some of our small economies have in the past relied on their neighbors for the supply of petroleum and have had moments in good faith when they had expected supply and have not received that supply. It is in those instances that governments must think hard and say ok if this is the case what we must do in terms of self-reliance. It is those challenges that have led from the change from cooperative to competitive.
L.R.M: The SADC population has continued to increase and in the process exerting more pressure on the existing power generating capacity. What has been Zimbabwe’s contribution to the expansion of generation capacity?
S.U: We have taken more or less four or five pronged attack. The first one, we have tried to sweat our existing assets. We started with Hwange with the support of Namibia and we continue to sweat out that huge asset. Its design capacity is 920 mega watts and on a normal day we getting 500 mega watts. We think notwithstanding its age we can get 750 mega watts. We have upgraded Kariba as it stands and want to repower the three small power stations so that we move to 300 mega watts from the three each one giving us about 90-100 mega watts. So sweating existing assets have been our priority thrust. Second, we are extending the two existing assets; Kariba 7 and 8 and Hwange 7 and 8 and Kariba is almost a certainty, 85 percent done as we speak and in Hwange by end of this year we should have started work there. Then of course we looking at green sites, Batoka is a case in point and so are a number of projects that are not necessarily government projects. We have liberalized the market and we are expecting projects at Gwai-Shangani worth 600 mega watts or more, Makomo at Hwange another 600 mega watts, Sengwa Gokwe North- huge projects 1200 mega watts. So population increase is an important consideration but more important is the utilisation of the power in terms of how much the economy is absorbing. So population is a useful indicator but in our case about 60 percent of our population is not connected to electricity.
L.R.M: What is the government doing to ensure that this 60 percent have electricity?
S.U: We have the Rural Electrification Agency. We are one of the few countries that charge a rural electrification levy on all customers going towards rural electrification. The rural electrification fund is up in running and certainly doing a lot. Since their inception in 2003-2004, they have now put on to the grid close to 9 000 institutions. Their initial focus is on schools, clinics, hospitals and if there are rural homes that are close by then they can be connected.
But we are a long way off hence the need for a rural energy master plan whose final validation was earlier this week which is proposing a different approach. The rationale behind the rural energy master plan is that if we go by just extending the grid, it will be many years before we extend the grid to many homes. We need to undertake rural renewable energy schemes at the same time. As I was saying at the validation workshop off grid solutions may be seen as such today but certainly can be linked to the grid tomorrow. They should not be perceived as undesirable solution but a phase to the eventual connection to the grid. So those are the initiatives that we have taken and we welcome the private sector to come into energy generation.
L.R.M: But there have been stories that private entities given licenses to produce power have all failed to kick-start the projects?
S.U: Power is a service you use as you generate. You can’t store it. So unless you are certain that as you implement your project that there will be takers of your power, and given the performance of the economy which has been sluggish. Its only now that we have begin to have a level of confidence, it has been very difficult to project that if you put in your plant, if you put in your turbines, your generator there will be takers of power.
L.R.M: How do you reconcile this hesitance to invest in power given a perennial deficiency of power? It appears there is a ready demand for power given that deficiency.
S.U: That explains the deficiency in many respects and because as I said initially we have not been investing in this sector. And when I say we I don’t just mean government, had been investing we wouldn’t be where we were 2007 and 2008 as a region. And even since then the projections that are there except for the South Africa’s economy, elsewhere there is hesitation. The only other country there was a measure of confidence in terms of private sector investment in the energy sector is Zambia. Elsewhere there is no reflection on the ground. Coming back to Zimbabwe, we have had private sector plants, small hydro in the Honde Valley for example along the Eastern Highlands, five feeding into the grid as we speak. We have had Bagase Plants and a historical one is Triangle Hippo Valley, they generate as much as 45 mega watts which they use internally and if they have excess they have possibility of feeding into the grid. Chisumbanje have capacity of 198 mega watts which they are feeding into the grid as and when they have excess.
L.R.M: Educate me on this, if you are saying that there is hesitance in investing in energy because one is not assured of the demand yet one of the noble objectives of the power pool is to sell excess power.
S.U: I might add that in terms of infrastructure, it is not always possible to sell. We have one corridor one from Inga to Johannesburg through Zimbabwe. We need two or three of such corridors. The North-South corridor is always overloaded. Secondly, areas that might need that requirement may not have the necessary infrastructure. I was saying 60 percent of our people are not connected and I don’t know how in terms of demand that can be equated to. In our case we went a decade or two when our grid really went down and that alone militates against effective trading of power.
L.R.M: Lastly, what can be done to create an enabling investment for high intensity energy users to set shop in the region?
S.U: We need to be able to offer the security of supply and also deal with our tariffs. We tend to have simplistic decisions being made that our tariffs are high when it’s not at all. In the energy sector the tariffs need to be competitive especially when the sector as a whole is performing well.
L.R.M: Are we ever going to have more black outs in the country?
S.U: We are not yet out of the woods until Hwange starts to operate so that we reach a level of self-sufficiency. I think around 2022 we would be confident of generating more power.
I think that is the reason why we need the Southern African Power Pool so that we are able to borrow power from other countries. We are keen on having Malawi and Angola on board.