Escom upbeat on Mozambique – Malawi interconnector

By WahardBetha

Power utility Electricity Supply Corporation of Malawi (Escom) says it is making great strides in its preparations to start importing power from the Southern Africa region through the Mozambique – Malawi Power Interconnector.

CEO Alexon Chiwaya lauded the progress made on   the project after Escom signed five agreements with Mozambique power utility Electridade De Mozambique (EdM) to operationalize the interconnector.

The agreements include; Project Implementation, System Operating, System Maintenance, Wheeling and Power Purchasing.

The project will in its initial phase see Malawi importing 50 Megawatts (MW) from Mozambique.

Chiwaya said: “The signing of these agreements manifests that we are making satisfactory progress in the project.

“The Power Purchase Agreement (PPA) is for a period of five years while the Wheeling Agreement will take 20 years to cover the estimated period for the cost recovery of the investment for the line by EDM and renegotiation will take its course after the agreement period.”

Under the Wheeling Agreement, Escom will be paying EdM for the full cost of investment for the Mozambique portion of the interconnector, and the latter will in turn give Escom rights over the line.

He stressed that, if any other party wants to wheel power through the line, including EdM, appropriate      compensation will have to be worked out to Escom to offset the full cost that Escom will have been paying for the line.

Chiwaya also said though the project is intended to import 50 MW, the power demand-supply balance for Malawi shows that, due to delays in the implementation of major power supply projects in the country in the medium to long-term, Malawi will need to import about 200MW of power from Southern African Power Pool (SAPP) for two to three years after the interconnector is commissioned to cover the projected power supply deficit.

“Kindly be informed that ESCOM has already engaged ESKOM of South Africa on the proposed power imports for a short period of three years and required agreements are being drafted,” he said.

Chiwaya said availability of adequate power through the interconnector will make significant contribution to the growth of economic sectors in Malawi including manufacturing, agro-processing, the service sector and tourism.

He commended both EdM and Escom personnel for tirelessly working on the project preparations and responsible ministers from the two countries for the policy direction.

The CEO also thanked World Bank, German’s KfW, European Union and Norwegian Trust Fund for financial support towards the project.

“Let me assure the financiers and all stakeholders that we will sustain the investment and ensure that Malawi works towards attracting Southern Africa Development Committee (SADC) Member States to trade in power with the country,” he said.

Mozambique’s Minister for Mineral Resources and   Energy, Ernesto Tonela, said he was happy that the project that involved prolonged negotiations between the two countries has culminated into the signing of the necessary agreements.

“We will make sure that Mozambique exports power to Malawi and in future Malawi will also be able to export power to other countries as it connects to the power pool,” he said.

He assured Malawians that though the project will initially be selling 50 MW to Malawi his government is willing to increase supply according to Malawi’s demand.

The scope of the project is to interconnect Malawi-Mozambique power systems at 400kV through              transmission line from Matambo substation in Tete province in Mozambique to Phombeya substation in      Balaka District in Malawi.

The project will by default connect the nation to the SAPP thereby enabling the country to not only buy power from Mozambique but also from the Region.

The total distance from Matambo to Phombeya is 210km with 140km in Mozambique and 70km in Malawi.

The cost of the project is pegged at US$127-million, out of this US$$92-million will cater for the Mozambique side and US$35-million for Malawi.

Malawi, which depends on power generated from its hydro stations on the Shire River, is banking on the           interconnector to solve its power supply challenges emanating from low water levels.

26 thoughts on “Escom upbeat on Mozambique – Malawi interconnector

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