Zimbabwe has inked a $455 million, 15-year concession deal with the Africa-focused unit of India’s Jindal Steel for the 920 megawatt Hwange Coal-Fired Power Plant Upgrade. This information was released by Zimbabwe’s energy minister.
The refurbishment works on six ageing units at the Hwange thermal power station is will take a period of four years. This was revealed by July Moyo during a post-cabinet briefing late on Tuesday. Furthermore, Jindal Africa will recover its investment from revenue generated by electricity sales from the plant.
Project Factsheet
Cost: $445 million
Duration: The refurbishment work is projected to span four years.
Concession period: The deal is a 15-year concession. Jindal Africa will recover its investment through the sale of electricity generated by the upgraded units.
Scope: The project specifically targets the six older units (Units 1-6) at the Hwange plant. These units, commissioned in the 1980s, have a combined capacity of 920 MW but have been operating at a fraction of their design capacity due to frequent breakdowns and obsolete equipment.
Capacity goal: The goal of the refurbishment is to restore the operational capacity of these six units, significantly increasing the plant’s overall output and helping to stabilize Zimbabwe’s national grid.
Significance of the upgrade:
- Addressing power deficit: Zimbabwe currently faces a severe power deficit, with demand often double the national generation. The refurbishment of Hwange’s older units is considered a crucial step toward alleviating chronic power shortages and frequent blackouts.
- Private sector investment: The agreement with Jindal Africa represents a significant private-sector commitment to Zimbabwe’s energy sector, which has traditionally been dominated by state-owned enterprises.
- Extending plant life: The project aims to extend the operational life of the older units by 15 to 20 years. This will ensure that they can continue to serve as a key part of the country’s energy infrastructure.
Current State of Zimbabwe’s Electricity Supply
Currently, Zimbabwe only meets around half of its 2,000 MW electricity demand. However, the nation experiences frequent and extended power cuts due to diminishing capacity at its ageing power plants.
About Hwange Coal-Fired Power Plant
The 1,520 MW Hwange plant stands as the country’s largest. The plant was upgraded in 2023 with the commissioning of two units, which added 600 MW. However, its older units were constructed in the 1980s and are currently operating at a third of their capacity due to breakdowns.
Also, the Kariba hydropower station, built in the 1960s, completed a 300 MW upgrade in 2018. This upgrade boosted its capacity to 1,050 MW. However, its generation capacity has in recent years been affected by drought. In response to addressing the generation capacity issue, the nation is also seeking to develop a floating solar project on the Kariba Dam.
