SADC countries move to boost energy sector

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Gracious Madondo

 

Countries in the SADC region have identified the energy sector as pivotal in boosting their respective economies.

Reports indicate a sudden interest by countries in the SADC region to give preferential treatment to companies wanting to invest in the energy sector as this is the driver of all other industries.

According to ESI Africa: Africa’s Power Journal, the South African government, for example, has set a target to attract $100 billion for economic development with the energy sector expected to contribute a minimum of $25 billion of targeted investment.

In order to achieve the $25 billion target, the South African government is inviting investors in the energy sector to consider South Africa for an energy business venture.

South African Energy Minister Jeff Radebe said at an energy and industry event in Cape Town last week that in April this year, the country procured 27 new energy projects at a total of R56 billion in investment and 2 300 megawatts of energy generation capacity to be added to the national grid for the next five years.

Radebe said the R56 billion investment would enable the achievement of the target of $25 billion in energy investments and have a positive impact on the country’s economy.

“We expect that this will have a positive impact on the economy and competition. The energy sector will certainly benefit the consumer in the long run. To achieve the target of $25 billion, we are inviting all investors in the energy sector to consider South Africa for their next business venture,” Radebe said.

“South Africa is open for business and we welcome foreign and direct investment,” the Radebe added.

Almost 95 percent of South Africa’s electricity is supplied by the state-owned power company, Eskom.

Eskom operates 23 power stations with a total capacity of 42 090 MW.

The 23 stations comprise of 36 000 MW of coal fired stations, 1 800 MW of nuclear power, 2 400 of gas energy, 600 MW hydro and 1 400 MW of pumped storage stations as well as the recent commissioned 100 MW Sere Wind Farm.

South Africa also buys and sells electricity to other countries throughout the region through the Southern African Power Pool located in Harare, Zimbabwe.

Zimbabwe has since embraced the “Open for Business” mantra and is calling for investors in the energy sector under the country’s new economic developmen agenda.

The government of Zimbabwe highly encourages the private sector to invest in energy to boost the country's power supplies as it is struggling to meet the high energy demands.

In attempts to attract investors, Zimbabwe launched the "ease of doing business" initiative parading itself to international business. 

At the beginning of this year, multinational global firms such as General Electric (GE) and the Enel Group of Italy invested US$40 billion in Zimbabwe’s energy sector.

The multinational companies said they have the financial muscle to undertake the Bakota power project on the Zambezi River, develop the power station and give the ownership of the power station to government. Zimbabwe and Zambia are exploring the exploitation of the Batoka project.

Zimbabwe’s energy supply is mainly from hydro and thermal power from Kariba Power Station (750MW), Hwange Thermal Power Station (920MW) and imports from Mozambique and South Africa.

According to the EnergyCyclopedia, an online industry and energy journal, Mozambique’s potential is one of the highest in Africa with substantial energy sources ranging from fossil fuels to renewable gases.

Reports indicate that more than 80 percent of Mozambique's population depends on small scale renewable energies and has no access to the national grid, leaving the diverse energy unexploited.

Just like its regional counterparts, the Namibian government is also urging investors to invest in the energy sector.

Energy is closely tied to the economy and likewise the future of sustainable economic development is dependent on the energy sector as energy promotes efficient ways of doing business.  

Common regional policies and strategies to enhance power security by increasing generation capacity and transmission projects associated with new power plants were put in place by the SADC Secretariat during the 36th Meeting of Ministers responsible for Energy in Swaziland two years ago.

A regional energy integration will go a long way in attracting investors in the energy sector who will be interested in investing in a regional energy programme.

 

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