Good news for investors as Zimbabwe plans a blackout-free future

Zimbabwe has a master-plan to ensure power supply constraints don’t put a brake on the country’s strategy for sustained economic growth, according to the latest investment report on Zimbabwean developments by the Pan-African Imara financial services group.

Imara’s October Zimbabwean report provides key statistics from the Ministry of Economic Development showing that a programme of power station development and upgrades plus utilisation of biogas technology could create a power surplus by 2014.

If upgrades and expansion plans come on stream as anticipated, current capacity could be quadrupled by that date.

Power rationing is currently a fact of life in Zimbabwe. In neighbouring South Africa, the risk to economic growth posed by power supply constraints was highlighted two years ago when monopoly power supplier Eskom switched the country’s lights off because supply could not keep pace with demand.

Grant Flanagan, manager of Imara’s Zimbabwe Fund, noted: “International investors see power supply security as a key strategic factor when making long-term commitments to African markets. Plans to quadruple Zimbabwe’s current power capacity will therefore come as good news to investors.”

Official power statistics show that current power demand can be as high as 2000 megawatts (MW) while supply is 1500MW.

The Kariba and Hwange power plants each have capacity of 750MW. The Kariba plant is in good working condition and can work to full capacity, unlike Hwange that only produces between 350-550MW.

Zimbabwe has three smaller plants, two in Harare and one in Bulawayo. The plan is to lease Harare and Bulawayo to private-sector operators, increase Kariba’s capacity by 300MW and upgrade Hwange, adding a further 600MW to capacity.

These initiatives would easily meet current demand of 2000MW, said Imara.

Additional plans call for a 2400MW power station at Sengwa with the first 500MW module to be commissioned by July 2014 with further modules being added thereafter. In addition, Government is in talks with another private sector company to build a further plant for 2000MW, again utilising Zimbabwe’s massive coal reserves.

The Ministry has already issue a licence for the exploitation of waste in Harare for biogas purposes. This operation is expected to come on stream in 2013 and add a further 120MW to national capacity.

Flanagan added: “If all comes right, we would have capacity of at least 3000MW by the end of 2014, with a potential of 6000MW thereafter thereby removing power as a constraint on economic growth.”