TINASHE MAKICHI/LIVINGSTONE MARUFU
THE Zimbabwe Energy Regulatory Authority (ZERA) is set to withdraw licences from various Independent Power Producers (IPPs) who havefailed to come up with integrated energy resource plans with the controversial businessman Wicknell Chivayo’s Gwanda solar deal under the spotlight.
Zimbabwe is sitting on 38 non-operational solar projects with a total capacity of 1280 megawatts (MW) as government is now looking at revoking dormant power producer licences, Energy and Power Development minister Fortune Chasi has warned.
The push to stem speculative behaviour in generation licences comes as the power utility is banking on electricity imports from South Africa and Mozambique and foreign currency payments from exporters to supply considerable power to the economy as hydro power generation is becoming unsustainable due to low water levels.
Information gathered by Business Times shows that some of the IPPs, who were given licences five years ago are yet to add electricity on the country’s national grid amid concerns that they could be holding onto the licences for speculative purposes.
Chasi told this publication that while there had been increased investor interest in the power generation sector the government was being cautious not to continue giving licences as there were some licenced projects which have failed to take off.
“We will soon be looking at dormant licenses and revoking them for non-performance. We want to do away with speculative behaviour. Some license holders paid close to nothing for the licenses and now want to sell them for a fortune that is not acceptable.
IPPs [independent power producers] should have a clear timeline as to when they expect to start production,” he said.
“There are 38 non-operational projects with total capacity of 1280.24MW. The capacities of the solar plants range from 0,19MW SAZ plant to the 175MW Sinogy Power solar plant.”
He said government through Zimbabwe Energy Regulatory Authority (ZERA) continues to licence private investors to operate as IPPs in Zimbabwe’s power sector.
As of July 31, 2019, ZERA issued more than 77 power generation licences and 70 of these are IPPs with 42 for solar power projects.
The total capacity of licensed solar projects is about 1285MW and this includes 5,5MW from operational projects and about 1280MW from projects under development.
Government has also licensed four operational biomass projects with a total capacity of 92.8MW, comprised of 3 Bagasse/Thermal projects and 1 Wood waste project which mostly generate power for own use, however excess power is banked in the ZESA grid.
In addition to this, there is a total of six licensed coal projects which are under development with a total capacity is 4560MW. These include the PER group venture with a capacity of 2000MW in Binga and the China Africa Sunlight Energy project with a capacity of 600MW in
Government has also licensed a total of 10 Small Hydro Power operational projects with a potential of feeding 31.326MW into the grid.
ZERA economic analyst Gweyneth Ngoma said that the regulatory body has moved to monitor the progress of various progresses of the licenced power producers amid serious power cuts that have rocked the country.
“ZERA had licensed close to 70 IPPs over the past few years but a few have implemented their projects like in the Eastern Highlands, but a majority has not done so due to a number of reasons which they didn’t share with us,” she said.
When cornered about ZERA’s action on Chivayo’s 100MW Gwanda solar project Ngoma said: “We are not going to leave any stone unturned, we are going to investigate each and every project which was licensed over the past five years and this case (Chivayo) will also be looked into. There won’t be scared cows.”
Chivayo’s solar project is one of the biggest solar projects in the country but could not take off due to abuse of funds and corruption. Government was reluctant to issue more licences in the prevailing environment as many are struggling with funding to kick start the projects.
The country has a daily peak demand of 1400MW but is currently generating less than 1000MW from its five power stations.
Other than, low generating capacity at the power stations, ZESA owes more than US$70m to regional power utilities which has affected power imports.
Speaking on the sidelines of the Energy Journalism workshop recently, ZPC Business Performance Manager Bernard Chizengeya told Business Times that the country is on a precarious position as cheap hydroelectricity plants would be closed in September and can only be reopened if the dams receive meaningful rain.
ZPC believes forex from exporters will help the energy generator to revive Hwange Unit 6 to improve electricity generation in the absence of Kariba.
ZPC needs a maximum of 70MW from small power stations with the help of Hwange and imports to reduce load shedding.
Zimbabwe is expected to be power self-sufficient after 2027 when all major power projects which are expected to generate over 2000MW are completed.