ZESA Holdings says it has paid off the $40 million credit facility it entered into with the Namibian power company Nampower in 2008, and had since signed a new agreement with the same utility to rehabilitate thermal stations in Harare, Munyati and Bulawayo.
In 2008, Zesa through its subsidiary Zimbabwe Power Company (ZPC), entered into a $40 million credit facility with Nampower where Zesa would amortise the loan through power exports to that country.
Zesa spokesman Fullard Gwasira told Southern Eye Business that the power utility had fully honoured the credit facility and had entered into another deal to rehabilitate thermal stations.
“I am happy to report that the $40 million facility has since been paid off and we paid it off at the end of January 2015,” Gwasira said.
“ZPC has entered into a new agreement with Nampower to rehabilitate the small thermal stations of Harare, Munyati and Bulawayo where the boiler technology is being changed to a fluidised technology which is better than the existing design,” he added.
Gwasira said Zesa was exporting electricity to Namibia because power could not be stored and the power utility could not switch off generators at night and found itself with surplus power at night when most people have gone to bed.
“Rather than switch off generators, which is very expensive to restart after such short periods as the morning peak starts around 5am, Zesa is sometimes forced to export this excess power at night to neighbouring countries which may be in need of power. This is only done if there is no domestic requirement of this power,” Gwasira said.
He said from April, Zesa would start amortising the new loan for rehabilitation of small thermal power stations by exporting 80 megawatts(mw) per month.
In its update last Thursday, ZPC had indicated that it was exporting 150MW to Nampower, 77MW to Day Ahead Market and 32MW to SNEL of the Democratic Republic of Congo.
Zesa is selling about 100MW to Nampower as part of efforts to raise money for the Kariba South extension project whose cost has ballooned from the initial $355 million to $533 million.
The Kariba South project is projected to add 300MW to the national grid when completed.
Zimbabwe has a peak electricity demand of 2 200MW, but Zesa generates about 1 015MW.Kariba Power Station produces about 630MW, Hwange 330MW, Munyati 28MW and Bulawayo 26MW while Harare Power Station is lying idle.
At Hwange Power Station, units Two,Four and Five are were taken out of service for a major overhaul; Kariba’s units One, Two and Five were also taken out of service while stations One and Two at Harare Station were shut down. Zesa currently imports about 50MW from Hidroelectrica De CahoraBassa of Mozambique.