ZPC gets US$116m for Hwange Project in Zimbabwe
The Zimbabwe Power Company (ZPC) has secured US$116m from regional financial institutions towards its equity contribution for the expansion of Hwange Thermal Power Station.
ZPC’s equity contribution was one of the major conditions that were stalling the financial closure of the US $1.1bn project to be carried out by Chinese company, Sino hydro. ZPC signed a contract with Sino Hydro to expand Zimbabwe’s largest power plant by 600 MW. This comes as the country seeks to increase power generation and reduce imports.
The funding will enable ZPC to add to 2 x 300-MW generators, commonly referred to as Hwange 7 and 8 to increase power output from the country’s biggest thermal power plant.
Currently, the power station has installed capacity of 920 MW. According to ZPC acting managing director Engineer Josh Chirukuutsi, ZPC has fulfilled all the conditions precedent for financial closure. Currently they are expecting the first draw-down for the loan.
The latest development is the first unit of the Kariba South power expansion which is now delivering 150 MW onto the national grid.
The remaining unit, with capacity to produce another 150 MW, will be running by March. The projects are part of the Government’s economic recovery programme under the Zim-Asset Infrastructure and Utilities Cluster.
The contractors are already doing preparatory works. Manufacturers in China have already started the manufacturing of equipment needed for the project. All the agreements and documents are in place.
Parliament has ratified the Hwange project loan and a power purchase agreement between Sino Hydro and the Zimbabwe Electricity Transmission and Distribution Company is in place.
The projects being carried out will see Zesa cutting on power imports, which are costing the power utility. Zesa imports power from regional utilities including Hydro Cahorra Bassa and Eskom of South Africa. These imports mainly cover local supply gaps due to limited capacity.
Zimbabwe requires an average of 1 400 megawatts against an average generation of 1 000MW.