• Zimbabwe faces blackouts exceeding 12 hours, severely impacting daily life and the economy
• ZESA plans to install a 1.8 GWh utility-scale battery system to reduce load shedding during peak hours
• Agreements with Jindal for repowering Hwange units and plans for new ferrochrome power plants
• Many proposed initiatives will take over a year to start, with funding issues potentially delaying projects even further

Harare- Zimbabwe is currently struggling with power blackouts due to recurring drought spells that are hindering power production at Kariba Dam. As of August 19, 2024, water levels have plummeted to a critical 9.46%, a contrast to the 27.89% recorded last year.

This decline has seen the water level fall from 479.46 meters last year to 476.87 meters now, resulting in a devastating reduction in usable live storage for power generation, shrinking to a mere 6.12 BCM from 18.07 BCM last year.

Zimbabwe and Zambia, both reliant on the Kariba Dam for power generation, have been forced to drastically reduce output, plunging both economies into crippling load shedding. Recently, ZESCO of Zambia hinted that it risks running out of water for power generation by 15 September.

Kariba, with a capacity of 1,050 MW, is now struggling to generate even 300 MW, barely exceeding 200 MW per day.

The drought pandemic is being worsened by recurring technical faults at Hwange Power Station, which now stands as the savior of the country.

Hwange Power Station, Zimbabwe's current key power plant, is also operating at a fraction of its capacity, generating less than 1,000 MW. While units 7 and 8 contribute a significant 600 MW, the remaining units (1-6) are struggling to produce a meager 400 MW.

Blackouts are now exceeding 12 hours in most suburbs, crippling businesses and disrupting daily life.

The mining industry, a vital sector for the Zimbabwean economy, is particularly hard hit. Electricity demand for mining companies has surged to 2,600 MW, while costs per kilowatt have skyrocketed beyond 14 cents.

This has pushed electricity costs to a staggering 20% of miners' overall expenses, driving many to the brink of closure.

In such difficult times, what is the government doing to ease power outages?

Turning to Battery Energy Storage

ZESA Holdings executive chairman Sydney Gata has announced plans to install a utility-scale battery energy storage system to minimize the power cuts being experienced in the country.

Addressing a press conference earlier this week, Gata stated that ZESA would install a utility-scale battery energy storage system of 1,800 MWh (1.8 GWh), which will provide three hours of 600 MW during morning and evening peaks.

However, the project is still at the procurement level.

ZESA is facing significant cash flow challenges, with a negative variance between cash received and cash obligations, despite a cost-reflective tariff approved by the government in December 2023.

The utility is struggling to meet its critical obligations, including loan repayments for the Hwange 7 and 8 expansion project, Afreximbank loan obligations, and essential expenses such as water, coal, fuel, and spares for generation, transmission, and distribution.

If successful, this will not fully solve the power problem again, as it will merely lessen blackouts to around 7 hours in privileged communities while still reaching about 12 hours in high-density suburbs.

Although the approach will be vital for peak hours, it won’t address hybrid working and thorough production.

Repowering Hwange Units 1 to 6

As another way of achieving electricity generation, ZESA has entered an agreement with Jindal of India to repower Hwange units 1-6, which is expected to increase output from 485 MW to 840 MW.

Jindal will invest in four new units at Hwange, adding 1,200 MW of capacity.

Ferrochrome Partnership

In June, the government urged ferrochrome producers, the heaviest consumers of energy, to produce their own power within the next two years to relieve pressure on the grid.

The agreement encompasses generating 300 MW of thermal power, with the first 100 MW expected by mid-2025.

Zimasco, one of the largest producers, has frequently shut down its plants over billing disputes with ZESA, especially at a time when ferrochrome prices are down globally.

Earlier this year, the company announced plans to build a 100 MW solar plant near its Kwekwe facility.

Other ferrochrome miners planning power plants include Jinan-Almid in Gweru and Titan Power in Hwange. Zimbabwe has 14 ferrochrome producers, the largest of which is Tsingshan’s Afrochine in Selous, producing 100,000 tonnes per year.

Expanding Hwange by Adding Units 9 and 10

With the government cognizant of the rising manufacturing and mining sector, it recognizes that electricity demand will increase.

It has projected power demand to hit 5,000 megawatts by 2030. As a result, the government has planned to start arrangements to expand Hwange by adding two more units, 9 and 10, which will likely provide a combined 600 megawatts, similar to units 7 and 8.

Feasibility

Though these are all commendable measures, they point to the future rather than offering short-term solutions. Most of these initiatives will not be started by 2025, meaning Zimbabweans will continue to face significant power shortages.

Additionally, the expansion projects require funding. ZESA has not yet paid back borrowed funds for the construction of units 7 and 8, making it unfeasible to secure another loan before addressing the prior debts. This will likely delay the projects further.

Therefore, all these measures indicate that solutions are more than a year away at minimum and possibly longer.

 Equity Axis News