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Lloyd Gumbo Senior Reporter
The rehabilitation and upgrading of Bulawayo Thermal Power Station inched a step closer last Thursday when the National Assembly unanimously endorsed the $87 million loan facility from the Export-Import Bank of India.
Zimbabwe and the Eximbank of India signed a loan agreement of $87 million on October 27, 2015 that will go towards the rehabilitation and upgrading of the power station over a period of two years.
The rehabilitation of the power station is part of Government’s plan to address the power shortages bedevilling the country as total generation capacity is about 50 percent of the demand.
Already, the country is reeling under increased load shedding because of falling water levels at Kariba Dam whose power station is the country’ s major source of hydroelectricity and for all practical purposes the largest power station since Hwange cannot be run at full potential output until upgraded.
The water level has fallen because of the drought that affected parts of Central and Southern Africa in the last rainy season. Almost all water in Lake Kariba comes from rainfall in eastern Angola and western Zambia.
Finance and Economic Development Minister Patrick Chinamasa, steered the agreement in the National Assembly last week where legislators across the political divide, upheld the decision to address the power crisis.
“The purpose of the loan facility is to rehabilitate and upgrade the Bulawayo Thermal Power plant from the current generation capacity of 30 megawatts to 90 megawatts,” said Minister Chinamasa.
“This facility was arranged after Government had taken cognisance of the challenges of power shortages faced by the nation.
“It had been noted that the demand-supply gap is resulting in reduced industrial and agricultural production leading to the economic decline of our country.”
Minister Chinamasa said scope of the project entailed among other things, replacement of existing boilers and turbines and rehabilitation of existing balance of plant.
He said electricity was a key enabler to any economic development given its centrality in industrial and agricultural productivity.
“The Zimbabwe Power Company will be the executing agent responsible for the implementation of the project. The project is earmarked to commence in 2016 and will be implemented over a period of two years.
“The total cost of the project is $87 million and the loan facility has a tenure of 10 years with three years grace period and will attract an interest rate of two percent, commitment fee of two percent and management fee of 0,5 percent. The loan will be repaid by the Zimbabwe Power Company.
“The implementation of the rehabilitation and upgrading of Bulawayo Thermal Power plant will help to improve availability and reliability of electricity supply resulting in increased agricultural and industrial production and increased economic activity.
“I therefore plead with the honourable members to approve the loan, which is in the interest of our economic recovery,” pleaded Minister Chinamasa.
The majority of legislators endorsed the loan agreement intimating that there was no need to debate. MDC-T legislator for Bulawayo South, Mr Edward Cross, said while he supported the agreement, there was need to ensure that the plant was not run on treated water meant for domestic use where it was already rationed.
He said there was need to use recycled water from Khami Dam instead of drawing portable water from existing water bodies.
However, Zanu-PF MP for Uzumba, Cde Simbaneuta Mudarikwa, who is a member of the Parliamentary Portfolio Committee on Mines and Energy said the position had already been clarified that the power station would draw water from Khami Dam.
He hailed Government for deliberately addressing the power challenges in Bulawayo saying this would enable industrial and agricultural productivity.
Minister Chinamasa also moved a motion for approval of a $20 million line of credit from OPEC Fund for International Development for the construction of 12 primary schools and five secondary schools in rural areas in eight provinces.
Online Reporter