AFTER stuttering in the initial phase, the 100-megawatt
(MW) Gwanda solar project is expected to resume later this year under a new
phased implementation schedule that could deliver the first 10MW within six
months.
According to the revised implementation plan seen by The
Sunday Mail Business, the first phase involves drafting an amended engineering,
procurement and construction (EPC) contract between the Zimbabwe Power Company
(ZPC) and the contractor, Intratrek, which is almost complete.
The parties will also seek a generation licence and
environmental management permit within a month, complete a power purchase
agreement (PPA) and conduct environmental impact assessment (EIA) within two
months, as well as fulfil renegotiated conditions precedent in two-and-a-half
months.
Further, they must have the funding proposal approved by
financiers in three months and get the first drawdown and EPC notice to proceed
in four months.
After this elaborate process, it should take six months to
deliver the first 10MW from Gwanda.
Energy and Power Development Minister Fortune Chasi
recently said the new implementation plan has full support from Government.
ZESA — the State-owned parent company of power generating
utility Zimbabwe Power Company (ZPC) — has since appointed economist and former
Government advisor Professor Ashok Chakravati to chair a special implementation
committee for the project.
“Given the current capacity depletion at ZPC, I have
appointed a Special Board Committee chaired by Professor Chakravati to assist,
expedite and oversee execution of the project,” chairperson Dr Sydney Gata
wrote in a correspondence to Government updating progress on the project.
Minister Chasi has been exhorting ZESA and contractor
Intratrek Zimbabwe to stop wasting time in the courts over a contractual
dispute and find an amicable solution that can deliver power.
The dispute, which has spilled in the courts, was sparked
by delays in implementing the project’s pre-commencement works. The parties have been brawling in the courts since 2017.
Demand for power in Zimbabwe, which stands between 1 800MW
and 2000MW at peak periods, especially during the winter season, far outstrips
internal generation capacity of about 600MW to 800MW.
Local production capacity is seriously constrained by aged
plant and equipment at the country’s largest coal power plant, Hwange Power
Station (rated 920MW), and drought that reduced dam water levels at Kariba,
whose hydro power plant is capable of producing 1 080MW.
ZPC cancelled the contract with Intratrek citing its
failure to complete preliminary works in time, but Intratrek argued that it
failed to deliver due to forces beyond its control.
The company claims that it delivered a feasibility study
report in time at a cost of US$2,1 million.
Other key preliminary works included geotechnical survey
(US$686 336), topographical study (US$25 000), site clearance of 200 hectares
(US$2 389 682), fencing (US$549 336), quarry and sand (US$190 000), signage
(US$30 000), which reportedly could not be completed in time because ZESA did
not have an environmental certificate.
It is believed that the certificate was only secured in
2018 after advance payment funding had been released to the contractor.
Preliminary works have since been completed at a total cost
of US$6,6 million, which is over and above the US$4,9 million that ZESA paid
through its generation arm, ZPC.
It is also claimed that there were further delays after
Sinosure – the State-owned Chinese guarantor of most outbound Chinese
investments – refused to cover the risk from the investment over previous
unpaid loans to Zimbabwean entities.
This was despite the fact that China Eximbank had agreed to
fund the solar project.
But now, under the new implementation modalities, funding
is being arranged from a consortium of international banks in Mauritius and
Dubai.
The funding arrangements are being spearheaded by power
projects consultant Victor Utedzi’s African Transmission Corporation Holdings
(ATC) through provision of US$14 million loan to finance the first 10MW phase.
ATC recently completed a 5MW solar plant in Nyabira, which
is already feeding the national grid.
The EPC contractor, Intratrek, will be responsible for only
5 percent of the project, whose cost has been reviewed from US$173 million to
US$140 million in line with the falling cost of solar projects across the globe.
The balance of 95 percent of project works will be executed
by the EPC contractor’s technical partner, CHiNT Electric Co. Limited, which is
listed on China’s Shanghai Stock Exchange.
In Zimbabwe, CHiNT has undertaken several projects already
after undertaking the installation of 16 substations for ZETDC, including 132kV
subtastations at Sherwood in Kwekwe, two in Redcliff, (including Zisco), and Zvishavane.
CHiNT, which has installed more than 5000MW of solar
globally and has successfully undertaken several projects for Zimbabwe
Electricity Transmission and Distribution Company (ZETDC) in Zimbabwe, was
founded in 1984 by billionaire Nan Cunhu.
Minister Chasi has been pushing ZESA and Intratrek to
respect a High Court order by Justice Tawanda Chitapi, which encouraged the two
parties to settle the matter.
Inordinate delays, he said, work against Government’s plan
to resolve the country’s power challenges. Sunday Mail
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