Zimbabwe signed a landmark 15-year concession agreement at $455 million with Jindal Africa. Through this new partnership, we will work together to rehabilitate the Hwange thermal power plant. This exceedingly ambitious project will eventually radically re-energize six aging units of the 920MW coal-fired facility over a four year period. The Zimbabwe plan — which is still under negotiation — would increase the southern African country’s electricity generation capacity, much of which has been severely affected by recent droughts.
Energy Minister July Moyo announced the initiation of the refurbishment project, calling it crucial to Zimbabwe’s energy future. At present, the country is able to meet only 50pc of its electricity needs that are 2,000MW. While rescuing the Hwange power plant might be necessary for addressing the electricity shortage, it certainly isn’t sufficient. It will go a long way towards improving the reliability of our electric supply across the country.
Details of the Concession Agreement
As detailed in this agreement, Jindal Africa will earn back their investment via electricity sales. This implementational arrangement heavily limits financial and operational risks to the Zimbabwean government. Zimbabwe plans to maximize expertise from the private sector through Jindal Africa’s operation of the refurbishment. This strategic approach reduces the burden on precious public dollars while increasing efficiency in operations.
The rehabilitation scheme calls for extensive overhauls of the six old steam-based units of the Hwange coal-fired power plant. These improvements are anticipated to not only save on staff time and materials but double the life of the lot. The project is part of a wider initiative to modernize Zimbabwe’s energy infrastructure and make certain that it can keep pace with increasing demand.
The State of Zimbabwe’s Energy Sector
Zimbabwe’s electric grid has been stagged by mismanagement, and increasingly by climate impacts, especially droughts that have decreased hydropower production. In 2018, the Kariba hydropower station underwent a major rehabilitation. Continuing this trend, an ongoing enhancement increased its capacity by 300MW, raising the total to an impressive 1,050MW. Older units of this facility, built in the 1980s, are experiencing frequent breakdowns. Consequently, they have a hard time running at full capacity.
Our recent partnership with Jindal Africa marks a progressive step toward solving these day-to-day challenges. The rehabilitation of the Hwange thermal power plant is a critical investment to stem the pressures on Zimbabwe’s national grid. These investments will cumulatively ensure a more resilient, reliable, and cleaner supply of electricity. This is essential to residential ratepayers and commercial enterprises alike, which have both suffered the negative impacts of rolling blackouts.
Future Prospects
Looking forward, the successful completion of this pilot project would help clear the path for further smart investments in Zimbabwe’s energy sector. As the country seeks to enhance its infrastructure, partnerships with experienced international firms like Jindal Africa may become increasingly common. Further, this joint effort may prove to be a template for other sector-based partnerships across the economy.