Cabinet greenlights 1,000MW Mozambique power procurement plan

THE Cabinet has given the greenlight to Electricity Minister Dr Kgosientsho Ramokgopa’s plan to import enough electricity to deal with at least one stage of load shedding from South Africa’s neighbouring country, Mozambique.

Minister in the Presidency Khumbudzo Ntshavheni on Thursday said the power purchase agreement between South Africa and Mozambique was one of the issues deliberated on during the Cabinet meeting on Wednesday.

This comes a week after Ramokgopa travelled to Maputo to meet with the Mozambican mineral resources and energy minister Carlos Zacarias to discuss the additional sale of power from Mozambique to South Africa.

Ntshavheni said the Cabinet welcomed the recent deliberations between Ramokgopa and Zacarias to secure additional power from Mozambique to support South Africa’s national grid.

“In the immediate term, Mozambique can provide 80MW and a further 1,000MW over the medium term,” Ntshavheni said.

“Cabinet continues to urge South Africans to support the “Winter Demand Management” campaign launched by electricity minister to save electricity and reduce the strain on the national grid, and help lower load shedding stages this winter,” she said.

An additional 1,000MW would mean that Eskom could lessen its load shedding by at least one stage, bringing some relief to businesses and households.

South Africa currently has a 6,000MW electricity deficit forcing the state-owned power utility Eskom to implement up to Stage 6 rotational load shedding to prevent the national grid collapsing.

As part of measures to plug this gap, the government resolved that Eskom should import power from neighbouring countries in southern Africa, such as Botswana and Zambia, through the Southern African Power Pool arrangement.

Last week, Zacarias presented Ramokgopa with the Mozambican energy portfolio, taking into account the response that Mozambique may offer to South Africa in the short, medium and long term.

“We will work and see how we can contribute to bringing about a solution in the short term,” the minister said, adding that the parties would meet again this month to assess all the possibilities for co-operation.

South Africa is the main buyer of power from the Cahora Bassa dam on the Zambezi River, buying about 1,400MW in a contract valid until 2029.

Eskom, however, has dragged its feet on negotiating to purchase more Mozambican hydro power.

Two major electricity generating projects: a second power station at Cahora Bassa, and a new dam at Mphanda Nkua, 60km downstream from Cahora Bassa – have been delayed by decades because of the lack of a firm buyer for the electricity they would produce.

Mozambicans feel that Eskom was the obvious buyer, but until the current South African energy crisis, it has not shown much interest in buying more power from Mozambique.

Ramokgopa will today brief the media on these and other developments, after he confirmed South Africa can secure 80MW in the short term, and a further 600MW from Mozambique in the next six months while committing to collaborate on more strategic long-term projects such as the Mphanda Nkuwa hydro-electric project and Cahora Bassa.

“When we were there on Monday with the minister in the Presidency (responsible for Planning, Monitoring and Evaluation, Maropene Ramokgopa) and my counterpart in Mozambique, and a number of state players in the Mozambican energy eco-system, they did indicate we will be offered about 80MW, and in the next six months we will get about 1,000MW,” Ramokgopa said.

“We are concluding the discussions with our counterparts, so we are confident of getting that.”

The stages of load shedding have surprisingly shrunk to around Stage 3 with the electricity availability factor above 60% in recent days, as unplanned breakdowns have dropped substantially as the government cracks down on further criminal activity.

Investec chief economist Anabel Bishop said South Africa was slowly making progress on the electricity crisis, with Ramokgopa implementing a number of measures such as seeking a special dispensation for Eskom to cut out the middle-man activity, and procuring directly from original equipment manufacturers.

Bishop also pointed to Ramokgopa identifying corrupt procurement officials and pushing ahead with procuring 2GW of emergency Karpowership energy supply.

“The rapid progress made by Ramokgopa has inspired markets although risks remain, and the state needs to take care not to show another escalation in allegiance to Russia,” Bishop said.

“Rapidly increasing renewable energy build is vital. The transfer of responsibility for new energy build to Minister Ramokgopa is a substantial positive, as previously the responsibility lay with Minister Gwede Mantashe, with little progress on renewable build since 2019,” she pointed out.

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