MALAWI WITH ITS PERENNIAL POWER SHORTAGES

MALAWI WITH ITS PERENNIAL POWER SHORTAGES Malawi, with its perennial power shortages, is expected to benefit from power trading agreements which the Southern African Power Pool is pioneering in some countries on the African continent including Botswana, South Africa, Mozambique, Lesotho, Zambia and Zimbabwe. Mozambique is one of the few countries in Africa that currently possesses an over-supply of electricity and is likely to dominate the supply-side of this trading market with Namibia, Zambia and Botswana expected be the main purchasers in the region, after South Africa. An executive from Standard Bank’s Power and Infrastructure Division, Cody Aduloju, said in a statement that in the next three to five years, power trading agreements between countries with excess power generating capacity and those battling supply shortages will be a dominant theme in the electricity markets of south-central African nations. And the power problems facing countries like Malawi are expected to be overcome with these power trading agreements between countries on the continent. But Aduloju said the biggest challenge to these arrangements will be reliable and stable transmission networks to facilitate the seamless transfer of electricity between sellers and purchasers. “Power will increasingly become one of the most tradable commodities across the region given the electricity shortage we are seeing across Southern Africa. The role of the Southern African Power Pool (SAPP) in ensuring cross-border planning, investment and trading between member states remains critical,” Aduloju is quoted as saying. SAPP has, since inception facilitated the regional power trading framework by ensuring reliable and economical electricity supply across the region. Its members include utilities and private power producers from Malawi, Botswana, South Africa, Mozambique, Lesotho, the Democratic Republic of Congo, Namibia, Swaziland Zambia and Zimbabwe. Aduloju said that Mozambique, which plans to double its generating capacity to five gigawatts by 2025, has the potential to expand the existing capacity of the Cahorra Bassa hydro facility by approximately 60 percent provided it can attract the necessary investment, he says. “The biggest challenge that Mozambique faces in taking advantage of this opportunity and many other power projects, is that it has weak transmission infrastructure, which is a key requirement for exporting adequate levels of electricity to other countries in the region. However, it has phenomenal potential for electricity production, ranging from coal, gas and hydro powered generation,” he said. Standard Bank, through its Corporate and Investment Banking division, has been actively involved with the Electricity Supply Corporation of Malawi to help the utility with capacity to supply electricity through strategic advice and financing.