Zambia’s Energy Sector Attractive to Private Investors – Finance Minister
Finance Minister, Dr Situmbeko Musokotwane, has described the country’s energy sector as being attractive for private investment as a result of the ready regional industrial market.
The announcement came at the 58th Annual Meetings of the African Development Bank (AfDB) in Sharm El Sheikh, Egypt.
The event also saw the Zambian delegation in an engagement with Kevin Kariuki, VP for Energy, Climate, and Green Growth at the AfDB.
The minister said, “We discussed energy sector investments and prospects for renewable energy projects. It is gratifying that we have convergent views on Zambia’s energy sector being an attractive proposition for private investment due to the ready regional industrial market.
“We look forward to the Bank playing a more substantive role in regional infrastructure projects, especially in infrastructure development”.
The AfDB has deep roots in Zambia: since 1971 it has committed more than US$1 billion in support of infrastructure, water and sanitation, energy, health, education, transport, and private sector development.
While at the event in Sharm El Sheikh, Dr Musokotwane and his delegation have also met with the Director-General in charge of African affairs at Germany’s Federal Ministry of Economic Cooperation and Development, Birgit Picke.
Picke stressed Germany’s commitment to “continue working with Zambia and helping the country to revive and sustain a robust economy”.
The annual meetings of the AfDB began on Wednesday and end today.
Photo: Lusaka Times
$2 Billion Solar Power Deal Struck with UAE Energy Company
The Abu Dhabi renewable energy company, Masdar, has struck a deal with the Zambian government to develop 2GW of solar energy – estimated to be worth $2 billion – in the country. The joint venture, made in January, has been made with ZESCO, Zambia’s state-owned and largest power company.
President Hakainde Hichilema announced the joint development agreement in a statement on his Facebook page, describing the agreement as “not a loan but a capital injection in which the Zambian people, through ZESCO, will be partners in shareholding”.
The development of these large-scale solar farms will be rolled out in phases of 500MW at a time, and is expected to start in the immediate future.
This is only one of many direct foreign investment deals struck with the Zambian government in recent months. Following just a month after news of the UAE-Zambia deal, it was announced that the UK energy sector would also invest $2 billion in a green energy join ventures agreement. Then, just days ago, ZESCO signed a deal with China’s Integrated Clean Energy Power Company (CiEG) for renewable energy production worth $3.5 billion.
These foreign direct investments are an extremely welcome boost to Zambia’s current energy capacity. An estimated 30% of the population has access to energy. Not only will these investments widen that figure, it will also improve the quality of energy supply experiences by those who are connected.
Zambian and UAE energy delegates at the signing of the Masdar-ZESCO agreement (@HHichilema)
Zambia’s previous reliance on hydropower (estimated to be roughly 80% of Zambia’s energy output) has left the grid struggling following periods of disrupted rainfall and extreme weather. Especially damaging were the critically low water levels in the Kariba Dam some months ago, a resource that is central to the country’s hydropower generation.
It is therefore hard to overstate the importance of President Hichilema welcoming investment from Masdar, CiEG, and others. It shows that the government is looking to diversify its energy supply within the realm of renewables. This diversification will increase its resilience to climate fluctuations which can affect the production of hydropower. By doing so, it is looking forward, not only to a greener future, but also to a more economically prosperous one.
Zambia needs significantly more energy in order to develop its economic potential. Drastically increasing the country’s power is necessary for improving and mechanising the agricultural industry, which is currently rooted in small-scale and traditional farming methods. More generally, closing the energy poverty gap will increase employment opportunities and bolster GDP.
President Hichilema said in a statement on Twitter in January that the Masdar-ZESCO agreement was “unprecedented” and showed “strong investor confidence” in Zambia. The energy deals struck in the months after are proof of this, and point to a bright future for the country’s energy and economy.
British Firms To Invest US$2 BILLION In Zambia’s Energy Sector
ZNBC, Arnold Tutu, January 11, 2023
Seven companies from the United Kingdom are investing TWO Billion dollars in setting up renewable energy projects in Zambia projected to produce two thousand Megawatts of electricity.
British High Commissioner to Zambia NICHOLAS WOOLLEY says the British companies are currently conducting feasibility studies and applying for regulatory approvals before they can kick start their projects.
Mr. WOOLLEY has told ZNBC News in an interview that the companies want to set up solar and wind energy projects in various parts of the country which will produce power to be sold to ZESCO.
The British envoy says the two thousand megawatts will be ready to be added to the national grid in the next two to five years.
And Head of Economic Development and Green Growth at the British High Commission in Zambia SARAH BLOOM says a lot of regulatory reforms are needed in the country’s energy sector for it to attract more investment.
Ms. BLOOM says tariffs need to be attractive and that ZESCO should be in a good financial situation for it to be buying power from independent producers.
And Special Assistant to the President for Finance and Investment JITO KAYUMBA says President HAKAINDE HICHILEMA is committed to reforming the energy sector to make it more attractive to investors.
Mr. KAYUMBA says government is working towards attracting more investments in the sector to achieve energy surplus in the coming five years.
He says the current energy crisis has highlighted the urgent need to increase the amount of energy the country produces to surpass the demand.
The seven British firms which are about to invest in Zambia are Hive Green, Western Power, Buffalo Energy, Africa GreenCo, First Quantum Minerals Solar Energy, Vitalite Solar and SolarAid.
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Zambia’s Role in the Green Energy Transition
Zambia is well positioned to provide the world with the minerals it needs to transition to renewable energy.
With its significant reserves of copper and cobalt, metals that are fundamental to the transition away from fossil fuel reliance, it has the potential to provide global supply chains with crucial components for years to come.
These minerals are used not only in wind and solar powered technology, but are also fundamental to the production of batteries used in electric vehicle production.
Transitioning to electric vehicles and increased energy supply via renewable sources is fundamental to the shared global commitment to keep global warming below 1.5 degrees. In the words of the United Nation’s Net Zero Coalition “replacing polluting coal, gas and oil-fired power with energy from renewable sources, such as wind or solar, would dramatically reduce carbon emissions.”
Consequently, according to the International Energy Agency, Copper demand is expected to three times its current level by 2040, while cobalt demand is expected to rise more than twenty times.
Zambia accounts for 6% of the world’s copper reserves. It produces 850,000 tonnes of copper annually, making it the world’s 7th largest producer but with government focus and foreign investment this is expected to rise significantly.
Canadian firm First Quantum Minerals (FQM) have committed to a $1.25 billion dollar investment into the Kansanshi copper mine as a reflection of their “renewed confidence” in Zambia’s investment climate. The investment is designed to expand the mine and seize the opportunity rising international demand presents.
President Hichilema is keen to see Zambia meet the global rising demand in order to spur economic growth. A key part of the UPND’s growth strategy, designed to steer the country into a period of middle income prosperity following the instability of the Lungu years, is the commitment to increase copper production more than three times over.
By 2030, it is hoped Zambia will produce 3 million tonnes of copper a year – that represents an impressive 352% increase in production on a commodity that already accounts for 80% of the country’s export earnings.
Copper is critical for solar PV, wind, hydro, electric vehicles and national electricity grids, there are few metals more fundamental to a green transition. Zambia is placed in an extraordinary position to spur its own economic take-off and to foster a status as a crucial player in the fight against climate change.
This is why during December’s US Africa leaders’ summit, held in Washington, D.C. leaders from Zambia, the Democratic Republic of Congo, and the US signed a memorandum of understanding to develop an electric vehicles battery chain.
It is also why US-based firm KoBold Metals have announced a $150 million development into the Mingomba copper-cobalt mine in the country. The Bill Gates backed startup aims to use artificial intelligence to create a map of the Earth’s crust, identifying areas with the highest concentration of cobalt and copper deposits in order to locate minerals overlooked by traditional exploration as the earth’s most accessible minerals have increasingly already been mined. The company’s CEO is absolute: he does not see KoBold as a mining operator but a leader in the “electric vehicle revolution.”
Because copper is a highly efficient conductor, it is used in electric cabling and its efficiency reduces wastage. It is also one of few materials that can be used again and again without a loss in performance. Copper plays an important role in making energy production as efficient as possible with minimal impact on the environment.
Traditionally, Zambian government have sought to extract the greatest possible tax value from the mining industry. However, the New Dawn government have reduced the tax payable on new mines in order to encourage further exploration, induce investment, and create the greatest possible economic gain for the entire Zambian economy, not just the government’s coffers.
In this new climate, mining giant Barrick Gold has recently announced record yields from its Lumwana copper mine. Crucially for Zambia’s future, the company’s presence in the country has benefits beyond corporate and treasury income. Barrick Gold employ more than 4,000 people in the country, 99.3% of those are Zambian nations benefitting from the firm’s employment. It has been estimated that when royalties, taxes and local employment are combined, the firm have contributed $8.2 billion to the country’s economy.
In the past, Zambia has not taken full advantage during copper booms. From 2003 to 2006 the price of copper tripled, Zambia’s economic growth rate also grew, but poverty and income inequality remained unaffected.
Without integrating the benefits of foreign investment into the broader economy, Zambia could once again fail to capitalise on the opportunities presented by its extraordinary natural resources. By encouraging foreign firms to employ Zambia workers in the mine, in catering, housing, security, and to executive positions within local structures.
As optimism grows that Zambia can play a leading role in a transformed world, there is hope that President Hichilema can create meaningful change for Zambians.
HH Holds Meeting With a Team From the Commonwealth
Lusaka Times, November 9, 2022
President HAKAINDE HICHILEMA has held a series of meetings during the ongoing COP27 in Sharm El Sheikh, Egypt. This morning, President HICHILEMA met with a team from the commonwealth to discuss matters of mutual interest.
Some of the key issues discussed include investment in renewable energy in order to create a viable energy mix for Zambia.
And Commonwealth Assistant Secretary General for Governance and Peace, Professor LUIS FRANCESCHI said Zambia is ripe for investments due to its peace and political stability.
President HICHILEMA later met officials from the International Finance Corporation- IFC, a wing of the World Bank group, where potential areas of investment were discussed among them Agriculture, manufacturing and mining.
The President emphasized Zambia’s strategic location saying the Country is well positioned to enhance trade and provide various goods and services for the region.
And IFC Managing Director MARKHTAR DIOP said following the fruitful conversation with President HICHILEMA, the group would undertake a feasibility assessment tour to Zambia soon with a view to explore more investment opportunities.
MEANWHILE, the International Chamber of Commerce -ICC- has awarded President HICHILEMA for playing a key role in Zambia meeting its Nationally Determined Contributions -NDCs.
President HICHILEMA received the Presidential Transport Champion Award of the year at an event presided over by Africa investor Chairman Awards Adjudication panel Chief Executive Officer HUBERT DANSO.
The President who received the award this afternoon at the ongoing cop27 conference in Sharm El sheikh, said the award came at the right time when the world was shifting to electric vehicle usage for transportation in order to protect the environment.
President HICHILEMA stressed that Zambia working with the Democratic Republic of Congo was ready to take part in the manufacturing of the electric vehicle batteries and that the headquarters of this Joint venture would be in NDOLA.
The President also took time this afternoon to visit the Zambian Pavilion at the ongoing Cop27 conference in Sharm El sheikh Egypt.
President HICHILEMA encouraged the Zambian delegates to not only participate in meetings but extract value, in order for Zambia to benefit from the ongoing negotiations.
The President also called on financial institutions attending the conference to create a favorable environment for potential investors in the green, clean and sustainable projects sectors to increase the number of players.
Zambia Sign Agreement with Namibia to Implement Historic Petroleum Pipeline
The New Dawn government has signed a Memorandum of Understanding (MoU) with Namibia regarding the development of the Namibia-Zambia Multi-Product Petroleum and Natural Gas Pipelines Project (NAZOP). The private sector development is set to supply 100,000 to 120,000 barrels of refined petroleum products per day.
The MoU represents both countries’ commitment to prioritising the petroleum sub-sector.
The Minister for Energy, Peter Kapala, explained; “Petroleum and its derivatives drive the engines of growth and development through the crucial role that they play in the production and transportation of goods and services. The NAZOP Pipelines system, when completed, is envisioned to supply 100,000 to 120,000 barrels per day of refined petroleum products in Namibia and Zambia. The NAZOP pipelines systems are also targeting supplying other countries in the SADC Region”.
As a member of the Southern African Development Community (SADC), and the Common Market for Eastern and Southern Africa (COMESA), Zambia has preferential access to a neighbouring market of approximately 320 million people.
Given the volatility of international prices, significantly exacerbated by the Russian invasion of Ukraine, the Minister was keen to emphasise the importance of utilising the best available means to reduce the cost of delivering petroleum products to Zambia and its partners. This reduction in costs will not only benefit consumers but also businesses who use petrol in their production.
The Minister also commended Basali Ba Liseli Resources Limited (BBLR) for the proactive initiative they have shown in driving the project. The Zambian government has shown its willingness to promote cooperation between private and public sector initiatives. It is believed such partnerships are amongst the best means to efficiently deliver development for the nation. In April of this year, the government established a Private-Public Sector Forum to promote precisely this type of collaboration.
The New Dawn administration is particularly welcoming to foreign investment following the upgrade of its S&P credit rating in February this year. The MoU is the latest in a series of international partnerships being discussed by the Hichilema administration. Earlier this year Zambia and the Democratic Republic of Congo (DRC) signed a historical cooperation agreement to mine cobalt for use in batteries in electric vehicles. This partnership is set to firm Zambia's position in the global supply chain.
Image: The Blowup via Unsplash
Zambia's Energy Sector Drives the Country's Industrial Base... as Petroleum Pushes Social Interaction
Times of Zambia, September 14, 2022
ENERGY is a key sector to Zambia's socio-economic development and is inextricably linked to, and exerts a strong influence on other sectors of the economy.
Agricultural and industrial production, mining, tourism, construction, social and administrative services all rely on energy to drive their growth.
Petroleum products being mainly petrol, diesel and kerosene are used to fuel industrial activities both at micro and macro level, a clear demonstration of its importance to economic development.
In addition, petroleum products are useful at domestic level to fuel tanks of automobiles use by majority of the middle class for convenience, especially in a setting where public transport sectors are not well developed.
Hence, a private sector led energy industry is critical in enhancing the much needed capital to boost the industry's contribution to the economy.
With real Gross Domestic Product (GDP) estimated at 3.1 per cent this year, the energy demand is expected to grow at significant pace as well.
Zambia is said to be on a rapid economic recovery, driven by mining, tourism and manufacturing industries.
This is underpinned by the various reforms undertaken to revive Zambia's economy, as well as stimulate investment in key productive sectors.
The structural reforms, particularly those in the energy (Petroleum) sector are all aimed at accelerating growth, attracting investments and creation of employment for the Zambia people.
Thus, Petroleum plays a pivotal role in the economic development of every developing country like Zambia.
Access to gas and petroleum play an additional role of stimulating development in less developed rural area.
It is said that once a filling station is opened in rural area, not only does it serve to provide the primary function of providing fuel, but it results in the escalating of other industries such as lodges, entertainment spots, shops or industries and employment opportunities for the local population to mention but a few.
Furthermore, local tourism may be enhanced as well as promotion of social interactions and without fuel many of the social amenities cannot be properly exploited.
Politically, petroleum and gas related issues have been known to usher in new governments and result in the exit of others.
For example, the former Patriotic Front government kept domestic prices artificially low-through price control, export or quantity restrictions, or political pressures put on oil to act as subsidies.
With the coming in of the United Party for National Development (UPND) administration in August 2021, they adopted the "Cost Reflective Price Regulation on Petroleum" doing away with the subsidies.
The cost Reflective Price Regulation implemented by the Energy Regulation Board (ERB) is said to reflect the actual pricing of the commodity on the international market.
However, debates on the current pricing structure rages on from industry players, suggesting that it is difficult for businesses or individually to plan due to the monthly fluctuation of peterolum products.
Considering that Zambia is an energy importer that relies on raw material imports from the Middle East to be refined locally at the country's state-owned refinery, Indeni Oil Refinery, whose business model will soon change to a blending oil storage facility.
As a result, energy industry requires huge investments to encourage private sectorpar ticipation in the industry such as setting up of storage facilities.
For instance, Harvest Group of Companies and Othniel Brooks International Limited last year sealed a deal worth US$310 million from African Import-Export Bank (Afreximbank) to help build the country's three strategic fuel reserves.
This will help reduce the cost of fuel in Zambia and create product security once the three strategic reserves are completed.
The project will be implemented in the following provinces, North-western in Solwezi, Southern in Choma and Central in Kabwe.
Its Group chief executive officer Pauline Adaoha Ugo-Ngadi was quoted last year saying that the project will build infrastructure development in Zambia for the downstream sector of the oil and gas.
The Group intends to tap into opportunities that lie in Zambia's energy sector by working with progressive Zambians to grow local capacity in response to emerging global opportunities.
Harvest Group of Companies Limited is expanding its capacity to become a respected player in Zambia's oil and gas industry through promoting local participation.
This is a clear demonstration that with the correct policies and business friendly environment, many other ventures like the ones being undertaken by Harvest Group of Companies and Othniel Brooks International Limited will help accelerate Zambia's economic development.
Energy Minister, Peter Kapala, commenting on the developments in the sector says Government adopted a new business model for Indeni Oil Refinery to make it more efficient and effective.
Mr Kapala says works on the new Tanzania-Zambia Refined Oils Pipeline project has already begun, with the building of the 700-kilometer (435-mile) segment on the Tanzania side.
Zambia and Tanzania already share the Tanzania- Zambia Mafuta (TAZAMA) Pipeline, a 1,710-kilometer (1,063-mile) pipeline that has been transporting raw crude oil material for refining from the port of Dar-es-Salaam in Tanzania to the Indeni Petroleum Refinery in
Ndola from the 1960s until last year.
"The old pipeline has suffered wear and tear and some of its equipment is obsolete. However, the TAZAMA pipeline will be rehabilitated, cleaned up and reconfigured to start pumping finished products instead of commingled crude," Mr Kapala states.
Despite these efforts, "our two sister nations recognise the need to supplement the old pipeline, saying that the modalities to operationalise the framework of these pipeline have been concluded".
The new pipeline will run alongside the existing TAZAMA pipeline and will be more modernised and made mostly subterranean for security reasons.
The two pipelines - in addition to those from Angola and indeed Namibia - will bring in low-sulphur diesel from the Tanzanian ports into Zambia for our industries' mines and domestic use.
This will consequently reduce transportation costs and hence sustainably reduce the pump price of diesel, which is currently at a record high.
Within months, the pipeline will start pumping diesel fuel into Zambia. On the Zambian side, phase one of the new 12-inch diameter pipeline will end in Mpika District in Northern Province.
"We are in the final stages of finalising the financing mechanism for and we shall soon go out to tender. Phase one will cost between US$250 million and US$300 million to complete.
Phase two will see the pipeline extended from Mpika into Ndola on the Copperbelt Province and lastly phase three will be connected to a new pipeline in Solwezi in the mining region of North-Western Province," Mr Kapala says.
The total project cost for the two countries will be around US$1.5 billion.
Mr Kapala indicates that the country needs to act and reduce the local prices irrespective of what happens with the war in Ukraine, stating that the construction of the pipeline from Namibia, Tanzania and Angola are they way forward.
Zambia imports most of its petroleum requirements from the Middle East through the port of Dar-es-Salaam in Tanzania.
These two pipelines from Dar-es-Salaam will ensure these imports get into Zambia seamlessly. The pipeline from Angola will allow Zambia to finally access Angolan oil whose transportation will be cheaper than petroleum from the Gulf Region.
This applies to the Namibian oil too, once that also is available.
Mr Kapala also says the Government has renewed talks with the Government of Saud Arabia for cheaper importation of oil which will help oil marketing companies (OMCs) procure large volumes of the commodity.
On growing stakeholders' demands to revert to the quarterly fuel review to stabilise businesses ,the Minister says:"We have no plans to revert to previous ways of adjusting fuel prices after months, as that makes it hard to manage the debts owed to oil marketing companies and does not make the pump price to be cost-reflective."
Zambia's daily fuel consumption averages at two million litres (530,000 gallons) of diesel, one million litres of petroleum, and 800,000 litres of kerosene.
The desire by the Government is to facilitate ethanol blending plants in all the country's 10 provinces, which will be a game changer in promoting renewable energy in the country.
Mr Kapala says Government will start constructing ethanol plants in provincial centres for blending fuel, as a measure and strategy to reduce the cost of petroleum in the country.
"Blending of fuel will reduce the pump-price of fuel, which will reduce the cost of doing business and also facilitate the creation of more jobs for the youths.
"The plan is that the blended fuel will use ethanol from cassava," Mr Kapala states. In response to the Minister plans, Economic Association of Zambia (EAZ) is of the view that Government should come up with more incentives to propel biofuel blending activities in thecountry as it plans to establish ethanol blending facilities in the 10 provinces.
EAZ Copperbelt chapter chairperson Mathews Muyembe says the country lagged behind in terms of fuel blending despite having one of the robust biofuel blueprints in the region.
"We need to start offering incentives to investors wanting to start fuel blending to encourage more investments in the energy sector," Mr Muyembe says.
In terms of the investment opportunities, the expanding mining sector and economic activities will continue creating demand for the petroleum products in the country.
Therefore, it is evidently clear that Zambia's energy sector is set to drive industrial base that will stimulate growth and job opportunities for the Zambian people.
Image: Zbynek Burival via Unsplash
ZESCO Tenders for 50 MWp of Solar Power in PPP
Afrik 21, August 25, 2022
State-owned Zambia Electricity Supply Corporation (ZESCO) is inviting tenders for the construction of three solar power plants in several provinces in Zambia. Interested independent power producers (IPPs) have until 2 September 2022 to apply.
Zambia will soon have three new solar photovoltaic plants. The project, led by the state-owned Zambia Electricity Supply Corporation (ZESCO), is subject to a tender with a deadline of 2 September 2022. The facilities will be built in Southern, Western and Luapula provinces, with a combined capacity of 50 MWp.
The selected Independent Power Producers (IPPs) will develop, finance, build and operate the solar PV plants. All applications will be considered, together with the relevant feasibility studies, under commercial contracts agreed between the developers (IPPs) and the utility ZESCO.
The development of these projects should enable Zambia to diversify its electricity mix. The East African country has an installed capacity of 3,030 MW, of which 2,393 MW is generated by hydroelectric plants. The largest of these is the 1,319 MW Kariba plant, which Zambia shares with Zimbabwe. ZESCO obtains some of the electricity it distributes to people and businesses from thermal (gas and coal) and solar power plants.
With the increasing droughts in Eastern and Southern Africa, Zambia is faced with lower dam levels and therefore lower electricity production in the dry season. To cope with this situation, ZESCO wants to further diversify its sources of production by focusing on solar energy. Zambia already has an installed solar capacity of 91 MW according to Power Africa. Among the solar power plants commissioned in recent years is the 54 MWp Bangweulu plant. The park was built by a consortium of French IPP Neoen and Zambian investor Industrial Development Corporation (IDC).
For more information on the ZESCO tender, click here.
Government Launches Three Strategies and Action Plans to Increase Access to Electricity and Renewable Energy
Lusaka Times, July 29, 2022
The government yesterday launched three strategies and action plans under the Increased Access to Electricity and Renewable Energy Production (IAEREP ) project aimed at improving the management of the energy sector.
The European Union and COMESA funded project has seen the formulation of the Energy Management Information System, Zambia Power Development Framework and the Energy Sector Strategies.
Minister of Energy, Peter Kapala said the three strategies will transform the energy sector calling on all stakeholders to support the ministry successfully implement the strategies.
ZANIS reports that said Mr. Kapala this in a speech read on his behalf by Ministry of Energy Permanent, Francesca Zyambo in Lusaka today.
Mr. Kapala said the Energy Management Information System has been developed to automate business processes in the ministry and effective monitoring of the performance of the energy sector.
“The successful implementation of the three strategies requires the participation of all relevant stakeholders. Let me therefore implore the private and public sector institutions, the cooperating partners, research institutions, civil society and other key stakeholders to support the Ministry of Energy in the implementation of the strategies, “he said.
He explained that government is alive to the challenges faced by investors in the sector saying the development of the Zambia Power Development Framework, will help improve processes and procedures in the sector, while the Renewable Energy Strategy is set to ensure systematic investment into renewable energy market.
“The new dawn government realizes the importance that the private sector plays in the energy sector. In this regard, my ministry has been working on lessening the burden the investors have previously endured of moving from one office to another enquiring the procedures and the processes for obtaining licences for the power projects,” he said.
And speaking at the same event, Head of Cooperation for the European Union delegation to Zambia and COMESA, Arnaud Borchard said the EU and Zambia have since 2014 worked together in developing the energy sector through various interventions towards a green economy. He disclosed that over K4.2 billion has been invested in the sector citing the rehabilitation of the Kariba dam as one of the many interventions.
Mr. Borchard said the interventions are not only on the country level but regional level stating that EU plans to extend the interventions to other sectors such as water.
“We supporting electricity programme, particularly to increase access in rural areas. And these initiatives are fundamental for enabling a broader, inclusive economic and social development as well as facilitating the emergence of the green economy. Since 2014, we have allocated more than K4.2 billion to the energy sector under our partnership between the EU and Zambia and we are active in all compartments in the energy sector” he said.
Image via Lusaka Times
ZESCO to Commence the Exportation of Electricity to Zimbabwe
Lusaka Times, July 27, 2022
Energy Minister Peter Kapala says ZESCO will next month commence with the exportation of 100MW electricity to Zimbabwe under a five years deal.
In a statement published on his Facebook page, Mr Kapala noted that power from the Kafue Gorge Lower will be exported to Zimbabwe and Namibia through contracts signed in the last few months.
He added that Zimbabwe is currently facing a critical shortage of power because of the local power shortfall which has been worsened by the depressed generation at Hwange and Harare thermal power stations, including the loss of one unit, that is unit 6, that produces 125MW at Kariba Power Station.
The Minister explained that Zimbabwe Power Company – ZESA’s power generation arm is currently producing 1 201MW at its five power stations against peak winter season demand of 2 200MW, and last week, the biggest power generation plant in Zimbabwe, Kariba South, was generating only 758MW against an installed capacity of 1 050MW while Hwange Power Station was generating 411MW against an installed capacity of 920MW.
“This has forced the Zimbabwe Electricity Supply Authority (ZESA) to facilitate the creation of a group of intensive energy users to finance power imports from the region,” he said
And Zimbabwe Electricity Transmission and Distribution Company (ZETDC) Acting Managing Director Howard Choga told Zimbabwean media that the power imports were imminent.
“We signed power import deals with Zambia a long time ago, but we had not been getting electricity from that country because of cash flow challenges. Now, because we have prepaid, we expect this to be settled in the coming weeks and we will start receiving 100MW from Zambia. We have to prepay them a month before we receive the electricity,” he explained
Mr Choga added that the power import deal with ZESCO has a three to five-years tenure, as the negotiations with ZESCO were premised on Zimbabwe making pre-payments for the 100 MW, which will come from Kafue Gorge Lower and the condition precedent is that ZESA has to pay monthly deposits of USD 6.3 million to enjoy the facility.
He noted that the task of importing electricity from Zambia was led by a delegation to its subsidiaries namely, the energy generating company Zimbabwe Power Company (ZPC) and the Zimbabwe Electricity Transmission and Distribution Company (ZETDC) and other subsidiaries such as the investment branch ZESA Enterprises (ZENT) and internet provider PowerTel Communications (Private) Limited.
“ZESA is the only electricity generator and supplier for the public grid which represents Zimbabwe in the Southern African Power Pool,” he said
Mr Choga noted that Zimbabwe Electricity Supply Authority, (ZESA) whose official name is ZESA Holdings (Private) Limited, is a state-owned company whose task is to generate, transmit, and distribute electricity in Zimbabwe.
Image via Lusaka Times
SA Energy Crisis: Eskom To Import Power From Zambia, Botswana
ZNBC, July 26, 2022
BBC-Following three weeks of the worst power cuts in South Africa’s history, President Cyril Ramaphosa has announced a raft of interventions aimed at solving South Africa’s energy crisis.
These include improving the performance of state-owned power company Eskom as well as opening up electricity generation to private companies.
It follows 10 days of extensive discussions with energy experts to address the country’s immediate and long-term electricity requirements.
The main priority is fixing embattled Eskom: the utility’s maintenance budget will be increased to fix its ageing fleet of power stations.
Surplus electricity from independent power producers will be bought by the government and fed into the grid.
Eskom will also be sourcing power from neighbouring Botswana and Zambia through the Southern Africa Power Pool.
Other measures announced by the president include removing red tape for renewable energy projects and offering incentives to businesses and individuals to install and sell surplus power to the national grid.
Pointing to the future, President Ramaphosa said Eskom would have to coexist with private companies to ensure a diversity of electricity supply.
However the national grid will continue to be owned entirely by the state.
DRC/Zambia: An Agreement to Manufacture Batteries for Electric Vehicles
Afrik 21, May 9, 2022
Zambia and the Democratic Republic of Congo (DRC) want to use the 70% of the world's cobalt reserves in their subsoil for the local manufacture of batteries for electric vehicles. The two border states have signed a memorandum of understanding to create a joint value chain for the electric mobility and clean energy sectors.
The positioning of Africa as a world leader in the manufacture of electric batteries will undoubtedly involve the Democratic Republic of Congo (DRC) and Zambia. Lusaka and Kinshasa have just signed a cooperation agreement to develop their cobalt reserves, a metal that is essential to the energy transition and electric mobility because of its high energy storage capacity.
The project, called the “Republic of Zambia and DRC Battery Council”, will be implemented on two sites, one in the Congolese province of Haut-Katanga and the second in Copperbelt, a border region (Zambia) particularly rich in mineral deposits, including copper. This body, placed under the aegis of the United Nations Economic Commission for Africa (ECA), will benefit from financial mobilization entrusted to the African Export-Import Bank (AFREXIM Bank) for its implementation.
“Africa has long been considered a source of raw materials. This project should contribute to the diversification of the economy and the creation of green jobs for the reduction of poverty in our two countries,” says Zambian President Hakainde Hichilema.
Image via Afrik 21
Zambia to Export Additional Power to Namibia
CGTN, April 13, 2022
Zambia will start exporting an additional 80 MW of electricity to Namibia following an agreement signed by the utility companies of the two countries on Tuesday in Lusaka.
Zambia's Zesco Limited and Namibia's Nampower signed a power supply agreement for the export of an additional 80 MW in addition to 100 MW being exported after the first agreement was signed in 2020.
Victor Mapani, the Managing Director of Zesco Limited, said the signing of the agreement demonstrated the continued cooperation and trust between the two utilities.
According to him, being a member of the Southern African Power Pool has created opportunities for Zesco to play a major role in trade in the regional power blocks.
Kahenge Haulofu, the Managing Director of Nampower said the agreement demonstrated the relationship that exists between the two companies over the years.
He said such collaboration will make a meaningful contribution to the economies of the two countries.
Image via CFP
First Quantum Looks to Long Term Renewable Wind and Solar Power for Zambia Mines in Project with TotalEren & Chariot Transitional Power
International Mining, March 23, 2022
First Quantum Minerals (FQM) is pioneering an ambitious solar and wind energy project that it hopes will provide stable power for its Zambia operations on a long-term sustainable basis. While the ambitious project is still in its early stages, the mining giant is confident the proposed development will be one of the most significant renewable energy projects in Africa. The 430 MW project is expected to consist of a 230 MWp solar photovoltaic (PV) plant and a 200 MW wind farm to supply power to FQM’s operations Kansanshi mine in Solwezi and Sentinel mine in Kalumbila. Construction is expected to start next year.
The circa $500 million project will be developed, financed, built and operated by Total Eren, a leading France-based renewable energy Independent Power Producer (IPP), and Chariot Transitional Power, the African focused transitional energy group. It will be funded leveraging non-recourse project finance debt.
FQM’s Kansanshi Mine General Manager Anthony Mukutuma said: “The project will offer significant benefits to Zambia, by unlocking some of its world-class renewable potential. It will help the country realise some of its untapped solar and wind resources by attracting large-scale foreign investment and adding significant renewable energy capacity. In line with Zambia’s Vision 2030, the project will further contribute to improving Zambia’s energy-mix, reducing expensive regional power imports and exposure to fuel prices.”
While the company’s operations are already powered by approximately 80% renewable energy through a longstanding and ongoing relationship with state electricity supplier ZESCO – and which is expected to remain an important partner for the future – First Quantum also delivers significant greenhouse gas emissions savings – around 100,000 t CO2e in 2020 – through the successful implementation of mining technology that leverages this renewable power.
The new project would complement and expand Zambia’s existing renewable energy capacity to provide First Quantum with competitive and sustainable power for its Zambian mining operations, while delivering on the company’s commitment to decarbonisation. However, increasing pressure on Zambia’s existing hydroelectric resources together with increased risk of supply disruption as a result of drought has highlighted the need to diversify Zambia’s power supply while maintaining the current low emissions.
Major projects such as this underline First Quantum’s responsible mining credentials and are a critical part of its plan to reduce its carbon footprint by 30% by 2025, added Mukutuma.
Total Eren’s EVP and Global Head of Business Development Fabienne Demol said: “Together with our partner Chariot, we are pleased to bring our global expertise in solar and wind generation to power FQM’s operations. The combined solar and wind capacity will offer strong complementarity and power generation around the clock, with solar produced during the day and wind mainly at night. The project also represents a natural fit with Zambia’s hydropower resource seasonality; the project’s energy mix reaches its production peak during the dry season when the country is most exposed to droughts. Increasing the share of renewables will improve the country’s carbon footprint and address current and future challenges related to climate change.”
Total Eren is affiliated to TotalEnergies, the major energy company. In Zambia, TotalEnergies has more than 71 years of operations. The company’s ambition is to provide affordable, reliable, and cleaner energy in order to meet the ever-growing Zambian demand.
Chariot Transitional Power Executive Director Laurent Coche said: “We are very excited to be partnering with FQM and Total Eren on this ground-breaking 430 MW project in Zambia. This project further demonstrates Chariot’s commitment to assisting mining companies in Africa transition to renewable energy sources for their operations, with Zambia having an abundance of wind and solar potential. We are delighted to get started on the project, ahead of construction commencing in 2023, and we look forward to providing further updates in due course.”