South Africa will Purchase 90% of Output from Second Zambezi Hydropower Dam

Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--In August, the Mozambique government gave the go-ahead for the Mphanda Nkuwa hydropower dam project, which will be sited on the Zambezi River. The dam will be about 60 kilometers downstream from the Cahora Bassa hydropower dam and 70 kilometers from the city of Tete, which is becoming a regional hub for hydrocarbon resource projects.

Phase I of the project covers the installation of four turbines, which will generate a total of 1,500 megawatts (MW).The dam wall be 700 meters long and 90 meters high, with 13 discharge floodgates. The lake created by the dam's construction will cover 97 square kilometers.

South Africa's state-owned power utility Eskom (Johannesburg) will probably purchase up to 90% of the project's power output, with the balance going to the local Electricidade de Mocambique (EDM). South Africa's integrated resource plan for electrical power makes provision for 3,349 MW of imported hydropower.

Eskom currently purchases power from Cahora Bassa. When Mphanda Nkuwa is commissioned in 2012-18, it will be followed by the 1,250-MW Cahora Bassa North Bank project. Together, the projects would help to bridge the energy gap from which the southern African region suffers. Upgrades to the transmission network will be required to handle the increased output.

The $2 billion dam will be financed largely with a loan from China Exim Bank. It also is backed by a consortium, including EDM (30%), Camargo Correa (Brazil) (35%) and Energia Capital (Mozambique) (35%).

The cost of the complete project, with power house and infrastructure, will be about $4 billion. According to South Africa's Standard Bank, a financial adviser, there is significant interest in the project.

Environmental groups are opposing the dam on the grounds that it will displace 260 local families and that the combined impact of the dam with Cahora Bassa will cause problems downstream on the Zambezi. Supporters claim that the relocated families will have greater access to healthcare and education.

For related information, see December 2, 2011, article - Mozambique to Invest $2.8 billion to Increase Hydropower Capacity.

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