Egenco on autopilot

 There is a leadership vacuum at Electricity Generation Company (Egenco) following the premature dissolution of its board on July 22 2023, a development experts say may negatively affect the parastatal’s strategic direction.

Further, the position of chief executive officer is filled in an interim capacity after the former CEO William Liabunya left the organisation last December while company secretary Videlia Mluwira is on suspension since October pending a forensic audit that government instituted.

Comptroller of Statutory Corporations Peter Simbani, in an interview on Tuesday, disclosed that the decision to dissolve the board was made by the company’s shareholders.

According to the company’s Memorandum and Articles of Association, the shareholders are Secretary to the President and Cabinet (SPC) and Secretary to Treasury.

Said Simbani: “If I recall, the reason they gave was that it became necessary to dissolve the board in view of the ongoing reforms in the energy sector, which required a review of the skills set for Egenco board members.”

But his remarks are in sharp contrast with what happened in May last year when President Lazarus Chakwera accused Egenco management of failing to urgently restore Kapichira Hydro Power Station, taking a year and three months.

He said he had given Egenco management up to Christmas [2022] to have the station restored, but it failed to deliver.

“When this happened, I expected that the Egenco board that I personally appointed would take action against those managers at Egenco who failed to deliver. But it has now been five months since that deadline was missed and I have heard of no consequences for anyone at Egenco,” the President said.

Commenting on the reconstitution of a new board, Simbani said the process is at the tail end and that, “very shortly, a new board will be in place”.

While Simbani refused to comment on the impact of the absence of the board on the operations of the parastatal, experts have branded the situation as “a serious breach of corporate governance”.

Office of SPC spokesperson Robert Kalindiza admitted in a WhatsApp response yesterday, that Egenco has operated without a board for some time.

“As we are talking all is set and very soon the new board will be announced,” he said.

On his part, governance expert Mavuto Bamusi said the absence of the board means there is no oversight in the operations of the organisation.

He said this may also negatively affect Egencos’s strategic direction at a time it has managed to end power blackouts.

Said Bamusi: “Operations at power generation plants will be compromised due to the absence of a board sub-committee responsible for technical operations. This may result in a return to blackouts and load-shedding.”

But Simbani explained that Egenco shareholders have appointed a caretaker CEO and that once the board is in place, the process of recruiting a new CEO will begin.

The caretaker CEO is the organisation’s director of operations Maxon Chitawo.

However, Bamusi added that the absence of a CEO pushes Egenco into a dangerous power vacuum.

Said Bamusi: “Eventually, Egenco will be infiltrated by external political forces that will subject the institution to political capture, patronage and massive plunder of organisational resources.”

He further argued that the company may be weakened and fall prey to dynamics that are actively pushing for its dissolution and re-merger with the Electricity Supply Corporation of Malawi as happened with Power Market

 Limited which was established to undertake the functions of a single buyer previously performed by Escom.

The dissolved board comprised Betty Mahuka, Oswin Kasunda, Henry Kadzakumanja, Arthur Mandambwe and Evans Msiska while Secretary for Treasury, Secretary for Energy, Comptroller of Statutory Corporations, the Solicitor General and Secretary for Justice were ex-officio members.

In an interview on Thursday, Parliamentary Committee on Energy chairperson Werani Chilenga said his committee is equally concerned with the delays to appoint a new board.

Said Chilenga: “Unfortunately, our recommendations as Parliament are not legally-binding so no matter how much noise we may make, we cannot be taken seriously, but the leadership vacuum is unfortunate.”

In his farewell message to Egenco, Liabunya outlined a number of achievements the institution had registered since 2017 when he joined.

Among other, he mentioned the construction and commissioning of Tedzani IV Power Station (19.1MW) and Likoma and Chizumulu Islands Solar PV (13.1MW) as well as the signing of a contract for the construction of a 10MW Solar PV plant at Nanjoka in Salima.

He also cited the government’s award to Egenco as the best trading State-owned company, restoration of Kapichira’s 129.6MW, hosting of the Association of Power Utilities in Africa, capital dredging projects and reclamation of pond storages at both Nkula and Tedzani.

Liabunya and Mluwira were sent on forced leave to pave the way for investigations pertaining to how Egenco management handled the effects of cyclones Gombe and Ana that destroyed machinery at Kapichira Hydro Power Station