Africa Roundup

SA Flag

Eskom has requested from National Energy Regulator of SA (Nersa) a 35 percent increase over three years instead of the 45 percent the power utility had proposed earlier.

Business Unity SA (Busa) welcomed the softer tariff hike request, but warned that the revised proposal would nevertheless undermine growth in a post-recessionary environment and push inflation to unacceptable levels. The organisation said it was clear from recent SA Reserve Bank statements that electricity costs were playing a major role in preventing inflation from falling faster.

The Department of Public Enterprises also welcomed the revised application, saying Eskom had to ensure that the impact of the increase on the poor, and small and medium enterprises would be mitigated.

The revised application will translate into a price increase of 43 cents per kilowatt hour next year, 55 cents per kilowatt hour in 2011-2012 and 70 cents per kilowatt hour in 2012-2013. The reduction also means that Eskom will have to sell 30 percent of the new coalfired Kusile station, the Sere wind project would also be phased by 12 months and the coal project (Coal 3) would be replaced by independent power producer projects. Nuclear projects would also be delayed by 24 months.

Burundi flag

The government of Burundi has expressed interest in joining the joint DRC-Rwanda exploitation of methane gas on Lake Kivu. The project was announced soon after Presidents Paul Kagame and Joseph Kabila agreed on the joint venture at a recent summit. Burundi’s interest in joining the mega project was expressed by their Minister of Finance Clothilde Nizigama who called it “amazing and profitable” saying that it would come with many benefits that include power, fuel and fertilizers. “We would like to join the joint methane gas project, it should be regionalised like SINELAC, the power project that brings together our three countries,” Nizigama said after visiting the Rubavu-based methane gas plant. The three countries of Rwanda, Burundi and DRC are bound together by CEPGL, the Great Lakes economic bloc.

However, State Minister for Energy Dr Albert Butare said that Burundi would only benefit from the expected 400MW power project after the satisfaction of domestic power deficit, but would not be a partner in the project.

“The joint project is by two countries, DRC and Rwanda. Others like Uganda and Burundi will just benefit from power supply, and Burundi joining the project as a partner is something that can only be decided by the Heads of State,” Butare said.

He added that the regional bloc, CEPGL, has Rusizi One and Two power projects which are already running and shared between the three countries.


Kenya Electricity Generating Company (KenGen) recently signed a contract for the construction of the 120 MW Kipevu III power plant. This follows the dismissal of an appeal filed by Man Diesel to the Public Procurement Appeals Review Board challenging the tender award to another firm.

In a statement, KenGen MD Eddy Njoroge said that the project would still meet its due date of December 2010. “This project will help us stabilise the power situation in Kenya before we start implementing our plans to add 1,500 MW of capacity from 2013, primarily through geothermal sources, which are reliable and renewable,” said Mr Njoroge.

The Kipevu III project is one of those being financed using the proceeds of the Ksh25 billion Public Infrastructure Bond issued recently by the electricity generator.

KenGen will use the revenue generated from sale of power from the projects to pay interest and repay the Ksh25 billion it borrowed from the public. It is to start paying the 12.5 percent interest on April 30, 2010 and repaying the loan on April 30, 2012 after it secured a grace period of two years. In dismissing the appeal, the board noted that Man Diesel did not submit a valid bid bond for the tender and omitted to tender for a substantial part of the works.


A new developing licence for the Kudu gas field, which is likely to feature Russian natural gas giant Gazprom as a shareholder alongside existing partners Tullow Oil, Itochu Corporation and Namcor, will be announced soon.

Gazprom will construct Namibia’s first gas-fired power station at Walvis Bay. The project, which will cost an estimated US$1,2 billion, will start in January 21010 and is scheduled to be finished by 2013 when Kudu is expected to start pumping gas. A senior Mines and Energy senior official, saying that Gazprom, will enjoy equity in the new license.

“The (current) licence has lapsed and a new licence will be announced very soon,” quoted the official.

“Although details of the new participating interests have not yet been determined, Tullow is likely to remain as the operator of the Kudu gas field development,” the website reported.

Gazprom International Chief Boris Ivanov at the African Oil Conference in Cape Town earlier this month confirmed that Eskom will be buying 500 MW of the 800 MW generated at the plant, with the rest earmarked for the local market.

The National Petroleum Corporation of Namibia (Namcor) in June signed an agreement with Gazprombank, the lending arm of Gazprom, to help organise for the project, which includes the power station, a pipeline and other infrastructure. Ivanov earlier indicated that Gazprombank will source a pool of international lenders, mainly from the Middle East and Lebanon in particular.

Namcor held ten per cent in the previous Kudu licence, while Tullow Oil had 70 per cent and Itochu 20 per cent.

Botswana flag

The Botswana Power Corporation (BPC) has warned of more load-shedding when South Africa’s Eskom cuts down supplies by 100 MW next month.

“Eskom is going to cut 100 MW at the end of December and we have already put in place a number of measures to cover the supply gap. Load-shedding has already started and I am sure we are going to experience more of it in the coming months. I urge consumers to check the charts we have distributed so that they know in advance if their area is going to be affected or not,” acting BPC marketing and communications manager Tlhomamiso Selato said this week.

Eskom will cut its supply to Botswana from 350 MW to 250 MW next month as a result of its own constraints at home.

Rwanda flag

Rwanda has signed one of the world’s largest bio-fuel investment deals with an estimated value of US$250 million over the life time of the project. The project is a partnership between two of leading project developers, Eco Fuel Global LLC based in the United States and the British company Eco Positive ltd. In the first phase, they will invest US$50 million in the establishment of a jatropha plantation of 10,000 hectares on which some 120 million jatropha trees will be grown. The seeds of the Jatropha curcas yield oil, which will be used for the production of biodiesel for the Rwandan market.

The production of biodiesel is seen as one of the solutions to the energy challenges of the country, which currently imports all its fuel from the ports of Mombasa and Dar es Salaam. Every year, 160 million litres of diesel is used in the country, which is a burden on the economy while the demand for energy continues to increase.

The jatropha project would in its first phase of production yield 20 million litres, which would result in a 13 percent reduction in imported conventional fuel. On top of that, it would also help to reduce exhaust emissions, and thus the effects of climate change.

The project will also be beneficial for the economy: it is estimated that it will directly create 6,500 jobs and that more than US$100 million will be sunk in wages, social security provisions and community reinvestments. The investors will also make sure employees are trained.

The government has already allocated land to the investors in eastern province, near the Akagera National Park on which they will plant Jatropha, the plant which produces the seeds used to generate bio-diesel.

Rwanda’s Minister of Natural Resources Stanislas Kamanzi, State Minister for Energy and Water Albert Butare, the CEO of Eco Positive Limited Karl Boyce and CEO of Eco-Fuel Global, Mark O’Brien, signed the deal in Kigali. The former British Prime Minister Tony Blair witnessed the signing.

The project will see an initial investment of US$50 million and it is projected to start in the next six months. ECO Fuel-Global will do the technical aspects while Eco Positive will mobilize funds. The CEOs of the two companies say they will develop the project to bring on board other investors.

However, the project will take 5-6 years before it starts production. The plants will be planted on marginal land where food crops cannot survive. It is expected that the project will employ 6,500 people when it starts processing the fuel.


Energy Coordination Office (ECO) which hosts a new, recently merged Ethio-German Energy programme was launched recently in Addis Ababa.

The office, which will support rural electrification through small-scale solar and hydropower plants, was opened by Getahun Moges from the Ethiopian Electric Agency; Michael Biontino, Chargé d’Affairs of the Embassy of the Federal Republic of Germany, Geert Geut, Chargé d’Affairs of the Embassy of the Royal Kingdom of the Netherlands, and Ulrich Mohr, GTZ Country Director, GTZ said in a statement.

The coordination office will also promote energy-saving stoves which reduce firewood usage and offer policy and strategy advice to the Ethiopian government on improved energy service delivery.

“The Energy Office creates a platform for improved framework conditions for the rapid growth of renewable and appropriate energy sources in Ethiopia,” Getahun Moges was quoted as having said.

ECO is jointly funded by the Netherlands Directorate-General for International Cooperation (DGIS) and the German Ministry for Economic Cooperation and Development (BMZ) through the ‘Energising Development’ initiative, or EnDev, which works throughout Africa and recognises that access to energy is critical for sustainable development, poverty reduction and achieving the Millennium Development Goals, the statement added.