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100 COMPANIES FOR ESWATINI’S 80MW ELECTRICITY

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MBABANE – About 100 local and foreign companies have shown keen interest in joining the fray in the quest to generate 80 megawatts (MW) of electricity.


These entities responded to the recently completed exercise for the registration of companies with interest in participation in the soon to be launched competitive power procurement exercise by ESERA.
Eswatini intends to procure a 40MW solar and 40 MW biomass plants around the country.
“This power procurement exercise seeks to achieve an additional 80 MW capacity to locally generated power.


Outflows


‘‘This effort will result in a huge reduction in electricity imports for the country, which will result in multiple positive economic outflows, including job creation and possibly, increase in foreign direct investment,” said Eswatini Energy Regulatory Authority (ESERA) Manager of Consumer and Stakeholder Management Sikhumbuzo Nkambule.
Nkambule explained that the invitation for registration was aimed at collecting data that would be used for match-making purposes by prospective bidders.


He said all prospective project developers would be able to choose which companies to partner with in the development of their power generation projects from the collected data.
Partnerships on these power generation projects will involve companies ranging from project developers, long term project financiers, and construction and maintenance companies.
Following completion of the registration exercise, Nkambule confirmed that, over 100 companies from the different sectors had registered, as a sign of interest in participating in the soon to be launched procurement exercise.


Interested


He stated that 75 of these companies were local while the rest were foreign entities. Countries from which these interested companies come from includes South Africa, France, India, Israel, Netherlands and Germany among others.
“Even though the registration exercise was important, it does not in anyway, mean that companies which have not shown interest by registering will not participate when the actual tendering exercise begins. ESERA intends to launch the first batch of 40MW solar tenders in the second quarter of the current calendar year,” Nkambule disclosed.


He mentioned that for the purposes of match-making, the data would be made available to all interested stakeholders through the ESERA website, where a link to the data would be included in the information packaged for the request for qualifications document, which will kick-off the official competitive tendering process.


ESERA further thanked all the companies that had responded to the invitation to register, which was a sign that they were in support of the exercise that ESERA would soon be embarking on.
“Companies that may have missed the deadline for registration, or could not register, not to despair, as they will still be allowed to participate in the actual tendering exercise that should kick-off soon,” Nkambule emphasised.


Power


The country’s ambitious target, in the short to medium term, to increase local power generation of about 80MW is line with the Short term Generation Expansion Plan (SGEP) which stipulates that 40 Megawatts (MW) of power should be generated from solar while another 40 MW shall be generated from biomass.
Minister of Natural Resources and Energy Peter Bhembe recently said this was mainly to ensure maximum use of locally available resources first before we can consider resources outside the country.


“In the medium to long term, execution of this function shall be guided by the Eswatini Energy Master Plan which has a planning horizon of up to 2034. Continuous review of this plan will ensure that the sector stays abreast with developments both regionally and internationally, as cost effective plans shall then be adopted,” said Bhembe. 


He said the roll out of projects from this new capacity procurement process would ultimately improve security of supply in the country and also insulate, to some extent, electricity prices from external shocks, therefore stabilising electricity prices and contributing to the creation of a predictable and sustainable business environment.


Cross-subsidy


Bhembe said in their pursuit to create the most favourable environment for doing business in the kingdom, a cost reflective tariff migration plan had been developed to minimise the heavy cross-subsidy that exists between the various tariff categories, where business customers were carrying a heavy burden resulting in the cost of electricity for businesses being high in the country.
“To ensure the sustainability of cost reflective tariffs, the government has already approved a subsidy framework which was developed by ESERA,” disclosed Bhembe.

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