The Malawi power grid is soon expected to receive a combined 75 megawatts (MW) of coal and solar power generated from a single hybrid power plant to be located at Wovwe in Karonga district.
This follows a successful review and preliminary approval of an unsolicited IPP proposal submitted by African Energy and Power Ltd (“African Energy”) to Electricity Supply Corportaion of Malawi (Escom) in February 2020 and later to Power Market Limited (PML) in July 2020.
The commencement of the investment in the energy sector raises hopes for improved power supply in the country and is critical to attract investments, particularly in the mining sector.
After reviewing the unsolicited proposal, the PML has finally given African Energy, a go ahead to proceed with prefeasibility studies on the project, in the build-up to the conclusion of a Power Purchase Agreement (PPA) with PML once all the required procedures and stages set out in the IPP Framework have been complied with.
In its correspondence made available to Nyasa Times, PML has confirmed that the African Energy’s hybrid power plant proposal is in line with its power procurement plan and that the project can proceed to prefeasibility studies.
Commenting on the development, African Energy’s managing director and mining business tycoon, Lumbani Mbale stated that the development is great news to the company and an important step towards the accomplishment of the power project.
“At African Energy, we exist to create value and provide sustainable power and energy solutions to the Malawian population through sustainable strategic relationships with relevant stakeholders,” said Mbale.
“We and all our financing partners are more than determined to see the project come to completion for the benefit of the Malawi economy and all our shareholders,” he added.
Mbale added that with Malawi Energy Regulatory Authority (Meras licensing of PML as a single buyer, the project is expected to move at a much faster pace than before and we trust that the Malawi government will support us throughout all the stages.
According to the unsolicited expression of interest submitted to PML, the hybrid power project will be made up of 50MW of Coal Generation at a negotiable tariff of USD0.17/kWh with Expected Annual Energy Sales 416,000 MWh.
The plant will also house a 25MW Solar Generation consisting of a Ground-Mounted single tracker solar PV with a negotiable tariff USD 0.07/kWh. The Expected Energy sales from the solar component of the plant is Expected is 43,750 MWh.
According to one of the Project’s Project Engineers, Chris Heinermann, combining coal and solar power generation as one plant will significantly reduce pollution associated with coal power production, while offering electricity to the grid at a competitive tariff.
“Apart from power production, African Energy and Power Limited is also one of the few Malawian licensed wholesaler and importer of liquid fuels and gas with a supply capacity of over 5 Million Liters per month.
Through one of its parent companies, GDP Capital and Minerals Ltd, the company will have access to over 500 000 tons of coal per annum to power the plant, from its Nthalire, Mwankenja, Nakonde and Lufira coal basins, currently under exploration.
Energy consultant Grain Malunga, who is also former minister of Natural Resources, Energy and Mining, said completion of the project is critical, arguing that it has potential to improve electricity supply in the country.
“We see the project boosting the energy sector,” he said.
Malawi Confederation of Chambers of Commerce and Industry (MCCCI), which has complained of subdued production due to power deficit, is hopeful there will be speedy implementation of the project, as power outages have taken a toll on industrial output.
The private sector is keen to see long-term solutions to electricity problems and developments such as these in the energy sector could improve the business outlook.Follow and Subscribe Nyasa TV :