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Kenya Reduces Electricity Outages by 50% in Four Years

Kenya’s Ministry of Energy says that the average time customers are shut out of power supply per month has reduced from four hours per month in 2016 to one hour, 40 minutes in 2020.

Response time to outages has also improved, the data says. Over the same period, the number of hours, on average, that customers are cut off supply to fix power lines has dropped from seven to four.

These numbers concern the segment of the population that are connected to publicly generated electricity.

Kenya has a population of 48 Million people, according to 2019 data from the country’s National Bureau of Statistics. A 2019 International Energy Agency (IEA) report says that 75% of Kenyans have access to electricity.  It also says that over 95% of urban dwelling Kenyans have access, but 66% of rural Kenyans have access.

Kenya’s current effective installed (grid connected) electricity capacity is 2,651 MW, with peak demand of 1,912 MW, as of November 2019. At that time, demand was rising at a calculated rate of 3.6% annually, given that peak demand was 1,770 MW, at the beginning of 2018.

It’s curious how 75% of 48 Million people, which is 36Million, could find less than 2,000MW of electricity generation adequate.

But just five years ago, only 41% of the Kenyan population had access to electricity, according to the IEA report.

Charles Keter, Kenya’s Energy Cabinet Secretary, says the country has invested in measures to reduce power outages and is looking to have a utility that assures its customers of reliable power in the next few years.

The Energy ministry claims that Kenya Power has invested some $645Million improving its distribution infrastructure by constructing new substations and undergrounding of power lines to reduce interferences that cause outages.

 

 


Tripartite Meeting Resumes on Ethiopia’s Giant Hydroelectric Project

Egypt, Ethiopia and Sudan have resumed negotiations on Ethiopia’s Renaissance Dam, in Khartoum, capital of Sudan.
A meeting between the three countries’ irrigation ministers, an AU representative, and AU chair South Africa’s foreign minister took place Sunday, August 16, 2020.
Although the giant dam is largely for Ethiopia’s electricity supply, the meeting brings together the irrigation and foreign ministers from the three countries.
The ministers will sit again on Tuesday, August 18, with Nalendi Pandor, South Africa’s foreign minister, who is representing Africa Union chair South African President Cyril Ramaphosa.

Ethiopia has been building the Renaissance Dam on the Blue Nile since 2011, a project that has become a source of intense tension between Addis Ababa on the one hand, and Cairo and Khartoum on the other hand. This dam is expected to become the largest water-powered generation facility in Africa.
The 6,000 MW dam is to have a power generation of 16,153 GWh per annum through 16 generating units with 375 MW nameplate capacity each.

The initial filling of the reservoir has been a sticky point in the conversations. Ethiopia has insisted it will not accept negotiations that will lead to “legally binding” on the initial filling arrangements as they limit the country’s fair and equitable access to the Nile.


US Agency Awards Grant for Solar, Hydro Power in Northern Nigeria

The US Trade and Development Agency (USTDA) has awarded a grant to Konexa Energy for studies into solar power supply in parts of Northern Nigeria.

The support will enable technical and financial studies to be carried out. The studies will also address the regulatory and legal requirements of the mini-grids project. The American agency, which has shown keen interest in energy supplies in Nigeria, did not specify the amount of its subsidy.

Konexa, a new, renewable energy company with offices in London and Abuja, plans to generate 2.5 MW of electricity from several solar photovoltaic systems in Kaduna, in Nigeria’s northwest. “This project will support the development of critical energy infrastructure and an innovative business model to improve the generation, transmission and distribution of electricity in Nigeria, as well as to improve the supply of electricity to off-grid customers,” says Thomas R. Hardy, acting director of the USTDA.

The small solar power plants will be installed to supply mini power grids serving residential (household), commercial and industrial customers in Kaduna State in northern Nigeria.

Hardy says that the grant will also to support the acquisition of 30 MW of hydropower capacity from an existing but decommissioned plant. The electricity will be distributed through the Konexa grid. The USTDA grant is part of Prosper Africa, a U.S. government initiative to increase two-way trade and investment between the United States and Africa.

The company selected for the studies will carry out the environmental and social impact studies, assist in the selection of the meters and thus provide an analysis of the expected impacts of the development of the mini-grids.


South African Cement Producer to Build A Power Plant in Zimbabwe

Pretoria Portland Cement (PPC) is mobilizing finance to build and operate a 32 MW photovoltaic solar power plant in Colleen Bawn, in Zimbabwe’s Matabeleland South Province.

The Johannesburg based company has picked a Solar Power supplier for the project, the construction of which is expected to last around 18 months.

Half of the electricity produced will be used to power PPC’s facilities and the other half will be fed into Zimbabwe’s national electricity grid.

Zimbabwe is chronically short of electricity, with the country’s power utility supplying only around 1,000MW, to a population of 15 million people.

But Solar Energy solutions have become hugely popular in the southern African country in the last two years, such that more than 100 000 solar power systems are installed in homes across Zimbabwe, according to figures from the Ministry of Energy.

And companies are now turning to off grid independent solar energy. Last April,  the Caledonia Mining Corporation, which operates the Blanket gold mine, also in Matabeleland South Province, issued a call for tenders for a 19.65 MW solar project.

 


Egypt, Ethiopia Far from a Truce over Massive Hydroelectric Project

An agreement is still quite far-fetched between the three countries in the conflict over the largest hydroelectric power project in Africa.

Egypt’s Irrigation ministry says that the current round of negotiations, which concludes Friday, is not heading anywhere.

Egypt, Ethiopia and Sudan have been in talks regarding the impact on the flow of water in the River Nile, from the construction of the Grand Ethiopian Renaissance Dam (GERD) by Ethiopia.

At 6,450MW, the dam, formerly known as the Millennium Dam, will be the largest hydroelectric power plant in Africa, when completed.

Located in the country’s Benishangul-Gumuz Region, 15km east of the border with Sudan, it will also be the seventh largest in the world.

The gravity dam on the Blue Nile River has been under construction since 2011.

As of October 2019, the work stood at approximately 70% completion., but the filling of the reservoir, scheduled to begin in July 2020, is what is being held up by complaints from Egypt, which insists that the work will drain away large volume of water from its own section of the river.

An emergency meeting and videoconference of the Executive Council of the African Union, chaired by the South African President Cyril Ramaphosa, a week ago, resulted in considerable ease of tension.

After the talks, Egypt, Ethiopia and Sudan agreed to postpone the impoundment of the gigantic dam.

Sudanese Prime Minister Abdalla Hamdok said in a statement that it had been “agreed that the filling of the dam would be postponed until an agreement was reached”.

Mr. Hamdok added that “Sudan is one of the main beneficiaries of the dam, but also one of the big losers if the risks are not limited, which is why it reminds Egypt and Ethiopia of the absolute need to find a solution, “.

The Nile, which flows over some 6,000 km, is an essential source of water and electricity for a dozen countries in East Africa. Egypt gets 97% of its water needs from this river.

 


Cameroon’s Gas to Power Market in Distress

By Sully Manope

The Cameroonian electricity company ENEO (Energy of Cameroon), has announced a 32.6% drop in the production of thermal power stations in the country in the first quarter of 2020.

The reduction (compared with production during the same period in 2019), was due to rationing carried out “at some power stations because of a fuel shortage caused by enormous cash constraints.

ENEO has been unable to pay companies that supply gas to its generators (including Victoria Oil &Gas) as well as companies that generate power from natural gas (Globeleq, Aggreko).

Altaaqa, which supplied the generator ENEO used to convert gas to electricity at Logbagba, in Douala City, suspended operations at ENEO’s Logbaba site in September 2019.

Production capacities at Aggreko operated generating plants at Maroua and Bertoua decreased by almost 60% during the period under review, ENEO reports. Generation from Globeleq operated Kribi and Dibamba gas-fired plants also fell drastically.

This drop in thermal energy production, was, very slightly, offset by increased hydropower production, which had an uptick of 3%.

Overall, the Song Loulou and Edéa hydroelectric plants, both on the Sanaga River, provided 65% of Cameroon’s energy supply over the period.

 


AfDB Sanctions Danish Contractor for Fraudulent Practices in a Power Project

By Foluso Ogunsan

The African Development Bank Group has debarred Burmeister & Wain Scandinavian Contractor, for a period of 21 months, “for engaging in sanctionable practices in a power generation project financed by the Bank in Mauritius.”, the Bank said earlier today.

In 2014 and 2015, Burmeister & Wain participated in tenders for the redevelopment of the Saint Louis power plant in Mauritius, a project financed by the Bank.

”An investigation conducted by the Bank’s Office of Integrity and Anti-Corruption has concluded that it is more likely than not that the company engaged in fraudulent and corrupt practices in the context of this project”, the AfDB explained in a release.

”Evidence supports a finding that Burmeister & Wain, on a balance of probabilities, financially rewarded members of the Mauritian administration and others, through the intermediary of third parties, for providing access to confidential tender-related information which allowed them to tailor the technical specifications of the tenders to its offering, thus gaining an undue competitive advantage over other tenderers. Burmeister & Wain further concealed the arrangements it had entered into with the third parties, in breach of the rules governing the tenders”.

The debarment imposed by the Bank renders Burmeister & Wain ineligible to participate in Bank-financed projects and thus to benefit from its financing during the debarment period. The 21 months debarment qualifies for cross-debarment by other multilateral development banks pursuant to the Agreement for Mutual Enforcement of Debarment Decisions. According to this agreement, debarments longer than 12 months pronounced by any of its signatories, including the African Development Bank, the Asian Development Bank, the European Bank for Reconstruction and Development, the Inter-American Development Bank and the World Bank Group, are recognized and imposed in the same way by its other signatories.

By imposing a debarment of 21 months, AfDB says, “the Office of Integrity and Anti-Corruption recognizes Burmeister and Wain’s extensive cooperation with the investigation, the company’s transparency in dealing with the sanctionable conduct and the efforts that it has made to enhance its integrity compliance program since uncovering the sanctionable practices.

“The Bank will release Burmeister & Wain from debarment at the expiry of the debarment period, subject to a successful review and clearance of the company’s enhanced integrity compliance program by the Bank”.

 


Cameroon’s Power Utility Pushes its Gas Supplier into the Red

ENEO was once a key reason for Gaz du Cameroun (GDC) to dream big.

Seven years ago, the Cameroonian power utility promised an offtake of double the size of gas that the factories and other firms in Douala could readily demand from GDC, as the latter constructed pipelines and other infrastructure to incentivize consumption of gas in the country’s main commercial city.

But now ENEO (short for Energy of Cameroon), has fallen far behind in payment. The gross amount outstanding from the utility as at 31 December 2019 was $10.5Million, a significant debit in the balance sheet of a small player with production hardly exceeding six million standard cubic feet of gas per day 6MMscf/d.

The Logbagba gas field near Douala is GDC’s source of gas.

 As far back as 14 September 2019, Altaaqa, the generator supplier to ENEO, suspended operations at ENEO’s Logbaba site due to non-payment of invoices by ENEO.

GDC had continued to invoice ENEO based on take-or-pay provisions agreed to in the binding term sheet.

In April 2020, GDC announced that ENEO had arranged “payment of Four Invoices amounting to a net total of $2.9Million to GDC via “promissory notes” in the quarter”. That comes to no more than $4.2Million gross, but there is still a significant value of unpaid invoice to go.

ENEO’s default in paying a hydrocarbon producer is contrary to the new normal in Africa, where monopoly utilities and state hydrocarbon companies have general turned the corner in their attitude to paying debts owed to hydrocarbon producers in their countries.

Tanzania’s state hydrocarbon company TPDC and state power monopoly TANESCO pay gas producers more promptly. Egypt’s EGAS has improved terms of gas tariffs and annulled its debts significantly. Nigeria’s NNPC, though not exactly comparable as its case is joint venture agreements, has almost extinguished cash call arrears.

What makes the ENEO example particularly odd is that it is not an entirely state-owned company. It is majorly owned (51%) by Actis, the British investor and 44% owned by the Government of Cameroon. ENEO employees own a 5% stake. It is indeed an outlier of an example.


Cameroon Calls for Expression of Interest for Limbe Gas to Power Plant

Cameroon has launched a call for expression of interest to pre-qualify partners for the study, construction, and operation (Build, Operate and Transfer mode) of a gas-fired thermal power plant in Limbé, in the country’s Southwest.

Bidders have until July 10, 2020, to submit bids for this project, which must be completed by 2024, according to the government’s timeline.

With a production capacity of 350 MW, the Limbe gas-fired power station is expected to improve the supply of electricity in the Littoral, West, and South-West regions, a statement by the Ministry of Energy noted.

The Limbé power project is expected to include the conversion to natural gas of an existing 85 MW heavy- fuel-oil-fired reciprocating power plant and the addition, at the same site, of 265 MW of new-plant capacity. The new construction will be a combined-cycle, gas-fired plant.

Over the past 12 years, several actors have been involved in one iteration or the other of this project. With this expression of interest, it does seem as if the Cameroonian government has severed relationship with these players.

 


Finance Flows into Cote D’Ivoire For New 400MW Gas fired Plant

By Fred Akanni, in Lagos

The International Finance Corporation has signed a $339Million (or EUR 303Million) financing package for a proposed gas fired power project in Côte d’Ivoire.

The total cost of the project is $452Million (EUR 404Million), so the IFC intervention is financing 75% of the cost.

Which means that the Financial close and, Final Investment Decision are imminent.

The Atinkou Power Plant, to be located in scenic Jacqueville, a coastal resort town in the south of the country, consists of a 20-year concession to develop and operate a 390MW natural gas-fired power plant. The location is about 40 kilometers west of Abidjan, Cote d’Ivoire’s throbbing first city.

With combined-cycle turbine technology, the plant is expected to substantially reduce Côte d’Ivoire’s generation costs and GHG emissions, in part, through the displacement of older generation units. The sponsor of the project is the Eranove Group, an industrial group which also owns and operates the 544 MW CIPREL project, the largest power plant in the country.

As Lead Arranger and Global Coordinator, IFC arranged the full debt financing package of $339Million, which, beyond IFC, was provided by the African Development Bank (AfDB), Netherlands Development Finance Company (FMO), Germany’s Deutsche Investitions- und Entwicklungsgesellschaft (DEG), the Emerging Africa Infrastructure Fund, which is part of the Private Infrastructure Development Group, and the OPEC Fund for International Development (OPEC Fund). In addition to mobilizing the debt, IFC is providing, as part of the debt package, a $102Million (EUR 91Million) loan for its own account, as well as interest rate swaps to hedge the project’s interest rate risk.

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