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More millions for power
hristof Maletsky, The Namibian
December 13, 2007

http://allafrica.com/stories/200712130053.html

Windhoek - Namibia's power utility, NamPower, is to pump an additional N$60 million into the expansion and renovation of the Hwange power station in Zimbabwe after it became clear that the initial costs were underestimated. NamPower Managing Director Paulinus Shilamba said yesterday that US$10 million would be added to the US$40 million that was set aside earlier this year. The money would come from the parastatal's N$2 billion reserve fund. In return, Zimbabwe Electricity Supply Authority Holdings (ZESA) has undertaken to guarantee five years of electricity supply to NamPower - albeit at a cost. According to the agreement signed in February this year, NamPower will be supplied with 150MW for five years. Shilamba said his company would now get an additional 30MW to make it 180MW.

The two power utilities and Zimbabwe's Electricity Distribution Company (ZEDC) signed a loan and power-purchase agreement under which NamPower would advance the money on a loan basis and buy electricity from Zimbabwe. The expansion and renovation of the four generators at Hwange has already started. "So far the project is on track and we expect to receive the first 40MW flowing from Zimbabwe to Namibia in January 2008 as agreed," Shilamba said. The plan is to have the last generator fully repaired by August next year. Mines Minister Erkki Nghimtina and his Zimbabwean counterpart, retired Lieutenant General Mike Nyambuya, recently visited Hwange to familiarise themselves with the work at the plant.

Shilamba told the media yesterday that the project was scheduled for completion by the end of next year and that finer details of the latest US$10 million loan would be discussed between the power utilities during today's meeting at Victoria Falls. The four generators are capable of generating 480MW but have operated on and off as Zimbabwean power suppliers have struggled to cope with frequent equipment breakdowns and coal shortages. The rehabilitation of the Hwange power station would have major benefits for not only Zimbabwe and Namibia but also the rest of the southern African region. Namibia currently faces an electricity shortfall of around 300MW. At present, Namibia imports about 50 per cent of its electricity, mainly from the Koeberg nuclear plant in South Africa.

When SA had power problems last year Namibia introduced load-shedding - alternating power outages in specific areas. South Africa generates more than 75 per cent of the electricity used in the Southern African Development Community (SADC) region. Shilamba said earlier that even the 180MW from Hwange would come through SA, because the Caprivi power line linking Namibia and Zimbabwe will only be completed by the year 2009. Namibia also imports power from Zambia and Mozambique through the Southern Africa Power Pool
(SAPP). When South Africa's Eskom had power problems, Namibia was forced to reactivate the coal-fired Van Eck power station in Windhoek. South Africa is experiencing an increased local demand for electricity and Eskom has stated on several occasions that it cannot continue supplying electricity to other countries at the same scale.

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