Zimbabwe firms go green as fuel prices increase overheads
- Jun 29, 2020 8:06 am GMT
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By Bernard Mpofu
In 2019 several firms in Zimbabwe turned to renewable sources of energy as the country faced one of its worst power generation crisis in more than a decade.
Zimbabwe requires 2 200 megawatts (MW) of electricity from its five power stations which include a hydro-powered station in Kariba.
But as climate change took its toll on the southern African nation, electricity generation dropped to less than half of daily requirements, according to the Zimbabwe Power Company, a unit of the Zimbabwe Electricity Supply Authority (Zesa), the country’s power utility responsible for power generation.
The country experienced one of its worst droughts in living memory in 2018, which affected power generation capacity at Kariba Power Station, the country’s largest station.
The drought hit the country after Kariba Power Station had increased its generation capacity by 300MW in 2018. Resultantly, throughout the year, the country experienced power outages lasting up to 18 hours a day triggering serious socioeconomic consequences. There has been limited investment in the energy sector, a development that has resulted in frequent breakdowns at the existing power stations.
Domestic consumers turned to alternative sources of energy such as fossils and liquidified petroleum (LP) gas. To continue in business, and against a backdrop of power cuts and erratic fuel supplies, some companies turned to solar power to ease the burden on the national grid.
As power supply became more erratic, Zimbabwe’s miners, among the country’s largest consumers of electricity, increased investments in solar energy.
In October, gold miner Caledonia Mining Company invited bidders to build a 20MW solar farm that will feed its Blanket Mine in Gwanda, in Matabeleland South province, becoming the latest miner to step up plans to invest in renewable energy as an alternative to power utility Zesa.
Caledonia said the solar project would be built on 40 hectares next to its mine and is to be completed in three phases. The power plant would be commissioned in the final quarter of 2020.
“Given the escalating cost of diesel and the problems related with obtaining a secured supply, a solar PV plant with integrated storage is proposed to mitigate the impact of grid instability as well as to reduce reliance on diesel power generation,” the company said.
The capital-intensive mining sector is a heavy consumer of energy both locally and globally. Studies show that globally, energy accounts for as much as one-third of a mine’s operating costs. Lack of reliable power is one of the factors that has stunted new investment in Zimbabwean mining, which overtook agriculture as the backbone of the economy.
Other miners such as RioEnergy, the RioZim energy arm, are set to start the installation of 180MW of solar power at the gold mine’s operations this year.
Karo Resources, which plans to start developing a new platinum mine in Mhondoro-Ngezi in Mashonaland West Province in 2020, is to install a 300MW solar power plant to feed the operation.
In 2019, Zimbabwe’s largest mobile operator, Econet Wireless, commissioned a multi-million dollar 466-kilowatt (KW) solar power plant at its Willowvale industrial complex in Harare In the manufacturing sector, Schweppes Africa Holdings now operates with a solar off-grid system in Zimbabwe’s capital, Harare, that reduces its dependence on the national electricity network. It has been installed under an agreement signed with the off-grid Distributed Power Africa (DPA) supplier.
The off-grid consists of 2 446 solar panels connected by inverters that convert the direct voltage into an alternating voltage, similar to that of the electricity grid. This installation is capable of producing 1MW of electricity.
According to a study carried out by the Zimbabwe National Chamber of Commerce titled: Impact of Energy Challenges on Business in Zimbabwe, current power outages remain one of the major factors affecting the productivity and economic fortunes of companies.
“On monthly average, a typical business entity in Zimbabwe loses around Z$20 000 worth of production output and Z$300 000 worth of sales. The corresponding annual figures are Z$200 000 and Z$2,5 million. In summary, electricity power outages in Zimbabwe cost businesses in terms of both production output and sales,” the report reads.
“About 88% of surveyed firms indicated that the use of generators instead of electricity reduces their profits while 12% claimed that this did not affect their businesses. The use of generators for powering business activities is not the best option in the Zimbabwean set-up, and more so given that fuel prices have been constantly increased on weekly bases since July 2019.”
— Green Energy Zimbabwe