Mozambique moves to sell more power to Eskom
South Africa's state power utility is near a deal to buy more electricity from Mozambique's Cahora Bassa dam in a bid to ease an energy crisis threatening Africa's largest economy, a Mozambican official said on Tuesday.
Eskom is negotiating to buy an additional 250 megawatts of electricity per day from Hydroelectrica de Cahora Bassa, which runs the giant development in Mozambique's northern Tete province, HCB Chief Executive Paulo Muxanga told Reuters.
"They (Eskom) have requested, and we are about to sign an agreement in less than a month to supply them with an additional 250 MW," Muxanga said.
HCB currently provides 1,100 MW of power to Eskom, which has been forced to cut power across South Africa since the beginning of the year. The resulting blackouts caused large mines to shut down for five days and pushed precious metal prices higher.
The utility resumed a round of scheduled blackouts on Tuesday in a bid to trim about 1,000 MW from the national grid, it said in an announcement on its web site.
South African officials have warned that the power cuts could last years, raising fears that the crisis could cut into economic growth and dash the country's hopes of hosting a successful 2010 soccer World Cup.
Mozambique's government is eager to upgrade Cahora Bassa, which was built under Portuguese colonial rule in 1960 and then badly neglected during a civil war that erupted after independence in 1975.
Cahora Bassa has the potential to generate 14,000 megawatts of power, about seven times current capacity, according to Maputo. But getting it to that level will require a major investment.
HCB, which is majority-owned by the Mozambique government, hopes to lure foreign investors to the project but will push ahead with efforts to ramp up capacity at Cahora Bassa incrementally in the meantime.
"We are trying to convince other stakeholders (to participate in the upgrade). We have drafted a second operational policy and we are currenty carrying out a study to determine what we can do in the short term", Muxanga said.
Although it envisions some of the project's additional capacity being used domestically, Mozambique's government says most would be exported, primarily to South Africa, the region's largest consumer and producer of energy.
That would be welcomed by Eskom, which is struggling to contain the fallout from a power crisis that many see as the result of underspending on electricity generation and a failure by government to forecast a rise in consumption.
Eskom plans to spend 343 billion rand in the next five years and 1.3 trillion rand until 2025 to increase its generating capacity, a plan that includes constructing new nuclear power plants.
