Power producers delay irks Chakwera
President Lazarus Chakwera says he is not happy with delays in the roll out of power projects by Independent Power Producers (IPPs) and has called a meeting with the investors in two weeks’ time.
The President expressed his frustrations in Dedza yesterday when he commissioned the $33 million (about K33.1 billion) 20 megawatt (MW) JCM Golomoti Solar Power plant.
He said the plant is the fourth power project commissioned under his administration and yet the demand for more power remained higher than ever.
Said Chakwera: “This fortifies me in my resolve to move forward with the Private Sector Investment Labs my office is planning to facilitate through the Presidential Delivery Unit to identify any remaining bottlenecks we need to remove to expedite and escalate the level of investments in the energy sector and other sectors.
“I know that the blackouts have been inconvenient, but Malawians can expect to see a significant drop in blackouts by Christmas, because my administration has just secured a 60 million dollar soft loan from the World Bank to go towards the restoration of Kapichira over the next six months.”
He commended JCM Power for adding a cumulative 80MW to the national grid. He said the company deserved recognition for the 465 jobs created during the construction phase of the project, which proves that government policy of creating a conducive environment for private sector investment as a catalyst for job and wealth creation is the right one.
The President said the rehabilitation of the 130MW Kapichira Hydro Power Station is critical as it will ensure the country remains focused on reaching its target of having 1000MW supplied to the grid within
the next three years, which aligns with the need to prioritise energy production as an enabler for industrialisation as enshrined in Malawi 2063 Vision.
JCM Power chief executive officer Christian Wray said having delivered the Salima and Golomoti solar power plants, they will now focus on expanding the projects to increase capacity. He said the company has already secured land within the perimeters of the existing projects.
He said: “The Golomoti project is a landmark energy project that will have far reaching benefits to the industry and people of Malawi. JCM Power and its partner InfraCo Africa are extremely proud, honoured and humbled to be participating in this significant milestone in the power sector in Malawi.”
In his remarks, Minister of Energy Ibrahim Matola urged IPPs that are developing their projects to move with speed, saying they should learn how JCM Power managed to deliver the two projects within the same difficult Covid-19 pandemic period.
He warned non-compliant IPPs that government, through consultations with the Attorney General, will be forced to terminate their contracts and award those willing to practically implement theirs.
Acting British High Commissioner Fiona Richie said lack of reliable and sustainable energy remains one of the major obstacles to unlocking economic growth in Malawi because energy is a key catalyst for attracting more investment and job creation.
Last week, Electricity Supply Corporation of Malawi (Escom) said 11 IPPs were expected to add 343.26MW to the national grid by 2024.
The IPPs are those that have been approved and signed power purchase agreements with the sole power supplier.
Escom spokesperson Kitty Chingota confirmed that four IPPs are now operational and have added 92MW to the national grid.
The IPPs are JCM’s Salima Solar Power Project with 60MW and Golomoti Solar Project with 20MW, Mulanje Hydro Limited’s Ruo/Ndiza Hydro Project with 8.2MW and Cedar Energy Limited’s Hydro Project with 3.06MW.
In an interview yesterday, Malawi Energy Regulatory Authority consumer and public relations manager Fitina Khonje said in partnership with industry players and government, they facilitate an environment and processes that enable operators to establish themselves and contribute towards the country’s energy security.
But energy expert and former Escom chief executive officer Kandi Padambo observed that some IPPs are not forthcoming to invest because many prospective investors have complained that electricity tariffs in Malawi are not cost-reflective and too low to recover long-run marginal costs of an investment cycle.
The government Power Demand Forecast of the Integrated Resource Plan (IRP) 2017, as revised in 2018, indicates that the demand for electricity is projected to increase in excess of 800MW, 1 200MW and 2 500MW by 2020, 2025 and 2035 respectively.
