14 June 2013 - Malawi has signed two electricity deals with China, one being a transmission line project and the other being for the construction of a thermal power station. The two together are worth an estimated US$667 million.

The transmission line project would see Chinese company TBEA construct additional power lines and upgrade existing transmission lines in Malawi. The generation project would see the China Gezhouba Group Company (CGGC) design and construct a thermal power station at Kammwamba in southern Malawi.

Malawi’s energy minister, Ibrahim Matola, says that TBEA has proposed three possible upgrades in order of priority; the Phombeya-Salima-Nkhotakota-Chatoloma 220 kV transmission project; the Nkhota-Kota-Chintheche-Luwinga-Bwengu, 220 kV project; and the Lilongwe-Mchinji-Chipata 330 kV transmission line.

He says the Chinese funded projects will economically transform Malawi in the next 10 to 15 years. Malawi stands to more than double its power output and allow for the export of power, expansion of rural electrification and extraction of some minerals which has been hampered by a lack of adequate power, he says.

The Chinese funding is welcome as the Electricity Supply Corporation of Malawi (Escom) has conceded that not even World Bank funding of US $84.7 million will be sufficient to eliminate blackouts in the country. The World Bank energy sector support project, which rolled out in December 2011 and will be winding up in October 2016, will only mitigate and not eradicate incidences of black-outs.

Malawi's current generation capacity is 286 MW, 20% of which is lost in the transmission and distribution processes. But peak demand is currently estimated at about 330 MW, according to the World Bank, which expects electricity demand in Malawi to grow at about 5% a year over the next ten years.