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Mozambique’s R1.5 trillion energy overhaul to tap Zambezi’s power

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Mozambique wants to keep all the power produced by the Cahora Bassa lake, but also to accelerate its green energy agenda.
Mozambique wants to keep all the power produced by the Cahora Bassa lake, but also to accelerate its green energy agenda.
Eskom

BUSINESS


Mozambique is seeking to become one of Africa’s biggest hydropower producers and launch a green hydrogen industry.

The Mozambican government plans to add 14 000MW of hydropower capacity, with the bulk of that developed between 2030 and 2040. This was unveiled in a 60-page Energy Transition Strategy this week. A hydrogen programme will be set this year, government said in the document, which has not been released publicly.

The proposal is a blueprint of how one of the world’s poorest nations wants to harness its green-energy potential to boost growth and industrialise what, 50 years after attaining independence from Portugal, remains a largely impoverished agrarian economy

“Mozambique has vast energy assets,” said govenment, which puts the cost of the transition at $80 billion (R1.5 trillion) by 2050.

The strategic use of these energy assets can accelerate the transition to a middle-income industrialised economy.

The energy transition plan, while ambitious, bears similarities to those announced by South Africa, Senegal, Indonesia and Vietnam, which have collectively attracted funding pledges of $47 billion from some of the world’s richest nations.

READ: Mozambique to end 50-year hydro power deal with South Africa

At the heart of the proposal is the Zambezi River, Africa’s fourth longest. Already the country operates the 2 075MW Cahora Bassa power plant on the river. A group led by TotalEnergies SE and Japan’s Sumitomo Corporation is building the 1 500MW, $5 billion Mphanda Nkuwa dam.

In the decade to 2040, Mozambique aims to add 9 000MW of hydropower and more the decade after, by attracting investment into plants, similar to the model it has followed with Mphanda Nkuwa

Government, which repeatedly stressed the need for private investment as it can not fund the programmes itself, also wants to establish industrial parks to use the clean energy. Billions of dollars in expected revenue from natural gas projects in the north of the country are anticipated to transform the economy, but construction has been delayed by an Islamist militant insurgency.

READ: Mineral rich DRC, world's top cobalt producer, signs deals to make electric vehicle batteries

Such an expansion would allow Mozambique to compete with Ethiopia and the Democratic Republic of Congo (DRC) in the provision of power from hydro resources.

Ethiopia built a giant hydropower plant on the Blue Nile River, while the DRC has long proposed constructing Grand Inga, which would potentially be the world’s biggest hydro project.

One of the initial steps is to keep the 1 150MW it sells to South Africa from Cahora Bassa when that contract ends in 2030. While exports will be completely halted, the aim will be for Mozambique to use as much of its own resources to drive development and electrification, with 51% of its citizens having access to power now compared with 26% in 2017. Any export deals agreed to will be shorter and at better terms, government said.

READ: COP28: Private sector-driven green energy industries can unlock trillions for African economies

The southeast African nation also wants to extend its electricity grid, which in its current state prevents hydropower from Cahora Bassa reaching the capital, Maputo. An expansion would allow it to connect solar and wind plants. Initial costs are estimated at $2.54 billion

Overall the target is to add 7 500MW of solar power and as much as 2 500MW from wind.

Other programmes to decarbonise the economy include discouraging the use of firewood and charcoal for cooking by connecting more people to the grid and making liquefied natural gas easily available. Public transport will be switched from diesel to cleaner alternatives.

READ: Siyabonga Hadebe | How push for decarbonisation might hurt the poor

By detailing its plans, Mozambique is joining several African nations trying to attract investment into renewable energy. South Africa and Uganda are among those that have drawn up programmes to transition their energy industries away from fossil fuels.


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