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Zambia, Zimbabwe to retender $5bn Batoka hydropower plant

Map showing the location of the Batoka Gorge project

Photo by Bloomberg

25th March 2024

By: Bloomberg

  

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Zambia and Zimbabwe are retendering a $5-billion project to build a hydropower plant they previously awarded to General Electric Co. and Power Construction Corp. of China, and expect to select new bidders by September next year, an official said.

The Zambezi River Authority — a joint venture between the countries that maintains the Kariba Dam complex — expects to receive bids from potential developers by April 2025 and select bidders five months after that, ZRA Chief Executive Officer Munyaradzi Munodawafa said by email.

Work on the 2 400 MW Batoka Gorge project was initially scheduled to begin in 2020, but it encountered several delays, including the onset of the coronavirus pandemic and difficulties in securing funding. In June, Zambian Energy Minister Peter Kapala said the nation would exit the 2019 contract with GE and Power China because proper procurement methods weren’t followed when the deal was struck.

Drought, blamed on the El Niño weather phenomenon, has gripped the entire Southern African region, contributing to elevated food prices that have hurt poorer households. Zambia has declared the situation a national disaster.

Developing water-reserve buffers is therefore a priority, the ZRA chief said.

“Additional hydroelectric schemes will facilitate reservoir regulation for power generation and flood management,” Munodawafa said. “This means generation will be increased at Batoka during the peak season while water will be banked at the Kariba Dam for use during the dry season.”

Water levels at Kariba, which straddles Zambia and Zimbabwe, are expected to keep receding due to poor rainfall, Munodawafa said, although he ruled out decommissioning the dam.

ZRA has allocated eight-billion cubic meters of water to Zambian power utility Zesco and its Zimbabwe Power Co counterpart, which translates to 214 MW respectively for the two companies until year-end.

Batoka will serve as a mitigation measure to some of the hydrological problems at Kariba, while at the same time directly contributing “a significant increase to the desperately needed power supply capacity of Zambia and Zimbabwe,” Munodawafa said.

Edited by Bloomberg

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