PPPC upbeat on K1.1tn Mpatamanga power project
Public Private Partnership Commission (PPC) says it is optimistic on the $1.1billion (about K1.1 trillion) Mpatamanga Hydro Power Project after conclusion of negotiations for the relationship agreement to be followed by signing of a deal.
PPPC chief executive officer Patrick Kabambe disclosed the status in an interview on Thursday in Lilongwe after appearing before the joint committee of Parliamentary Committee on Natural Resources and Climate Change, Public Accounts, Legal Affairs and Trade and Industry to explain PPPC’s involvement in power purchase agreements and other initiatives being made by PPPC in the power sector.
He said two investors for the construction of the 350 megawatts (MW) Mpatamanga Hydro Power Plant were identified in October last year and government was negotiating the relationship agreement.
Kabambe said once the agreement is signed, the next step would be to finalise the design work and negotiations for the power purchase agreement.
He said: “We do not believe that the power purchase agreement will take too long because most of the issues have already been discussed in the relationship agreement.”
But Kabambe could not state when construction will start, saying the project is highly technical.
The joint parliamentary committee queried PPPC about the project against a background of Malawi struggling with insufficient generation capacity that is leading to prolonged rationing of electricity to consumers.
During the meeting, co-chairperson of the joint committee, Simplex Chithyola Banda, called on PPPC to find a way of fast-tracking the project, saying it is key to addressing the current power challenges.
He said: “The country is suffering from the frequent blackouts and this can only be addressed if we have additional power generation stations such as Mpatamanga.
“Looking at the progress on the project so far, as a committee, we are not satisfied. We want the project to be fast-tracked.”
The 350MW hydro power plant is expected to be constructed at Mpatamanga Gorge along the Shire River in the Southern Region where six other hydro power plants are also located.
The project is being developed under a public-private partnership model which will see State-owned Energy Generation Company (Egenco) holding a 30 percent stake on behalf of the Malawi Government. The other shareholders will be the World Bank Group’s private sector development arm, International Finance Corporation with 30 percent and a strategic partner to be identified will have a 40 percent stake.
A comprehensive World Bank-financed feasibility study for the project was completed in 2018. That is why the PPPC is in the process of procuring a key strategic strategic sponsor.
When commissioned, Mpatamanga is expected to double Malawi’s power generation capacity from the current 400MW against a demand of 618MW.
