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Malawi’s energy compact ends

By Taonga Sabola:

Malawi’s $350.7 million Millennium Challenge Corporation (MCC) energy compact came to an end Thursday after rolling for five years.

Among other objectives the compact was designed to modernise Malawi’s electricity infrastructure by broadening the band width to accommodate future investments in addition to bringing additional voltage into the national grid.

The energy compact was also meant to transform the power sector to bring efficiency and make it attractive to future investors.

The compact was also intended to increase individual and business incomes and reduce poverty by improving the availability, reliability and quality of power supply, expanding access to power, reducing the cost of doing business and revitalising Malawi’s power sector.

The compact was composed of three projects to increase the capacity, efficiency, and stability of the national electricity grid and the capacity and sustainability of hydropower generation at Nkula A generation plant.

As part of the compact, Malawi developed the 400 kilovolt Phombeya substation in Balaka and a number of substations in the Central and Northern regions as well as upgraded transmission lines to enable them transmit power at high voltage to minimise energy loses.

The Phombeya Substation is critical for Malawi as it would help the country to be a participating member of the Southern African Power Pool by tapping power from Mozambique.

Millennium Challenge Account (MCA-Malawi) Communications Director, Zilani Khonje, Thursday asked for more time to put every aspect of the compact in perspective.

Compact terms stipulate that a beneficiary country returns remaining uncommitted resources at the expiry of the compact period.

Energy Minister, Aggrey Massi, could not be drawn to comment on government’s impression of the compact implementation.

A Blantyre-based electrical engineer said yesterday Malawi needs to continue investing in energy infrastructure to avoid getting back to the pre-compact situation where infrastructure could not accommodate additional energy.

He said the compact has created space for about 500MW additional power to be accommodated in the grid.

“But if you look at projected demand as well as various energy projects lined up, chances are that we may exhaust the capacity in the next couple of years, which will mean we will need another huge once-off investment.

“To avoid such a situation, we need to continue making investments in energy infrastructure instead of waiting for that time to come,” he said.

Among other things Capital Hill plans to bring on board the 300MW Kamwamba coal-fired project in addition to other smaller hydro and solar projects.

Malawi Institution of Engineers (MIE) President, Wilson Chirwa, said the compact project has been helpful in modernising the electricity highway, adding that it is now up to the authorities to speed up implementation of various energy projects to address the critical power challenges the country is facing.

Malawi’s energy demand is expected to surge to 1,000MW in 2020, and 1,750MW in 2025 and 2,550MW in 2030 under moderate growth scenario.

Former Energy minister, Atupele Muluzi, told a High Level Forum on South-South Corporation on Sustainable Development in Johannesburg, South Africa, in 2014 that Malawi needs a total of $7 billion [about K3.6 trillion] investments in energy to meet energy demands by the year 2030.

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