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Most of Zambia plunged into blackout

23 December 2015 Comments (0) Africa, Business, Latest Updates from Reuters

LUSAKA (Reuters) – Zambia was plunged into a blackout on Tuesday affecting almost the whole of the country, the state power utility Zesco Ltd said.

“Almost the whole country except for Southern and Western province has experienced a power failure but we are yet to establish what has caused it,” Zesco spokeswoman Bessie Banda told Reuters.

Most of Zambia was affected by a power blackout on Dec. 11 because of a technical fault and supply was restored only the following day.

The southern African country, the continent’s second biggest copper producer, has been grappling with power shortages related to a searing drought as levels in the Kariba dam, which provides much of the nation’s electricity, drop.

Zambia’s Konkola Copper Mines (KCM), owned by Vedanta Resources, said after the Dec. 11 blackout it would suffer slight output losses.

An electricity shortage and weaker copper prices due to slower growth by top consumer China have threatened output and jobs in the mining industry, with the slow-down putting Zambia’s currency on the back foot against the dollar.

 

 

(Reporting by Chris Mfula; Writing by Ed Stoddard and Richard Balmforth; Editing by Kevin Liffey)

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IMF says Zambia’s electricity price to attract investment in power sector

3 December 2015 Comments (0) Africa, Business, Latest Updates from Reuters

LUSAKA (Reuters) – Zambia’s electricity price hike will ease power shortages that have put pressure on the economy of Africa’s No. 2 copper producer, the International Monetary Fund (IMF) said on Thursday.

Zambia’s economy is likely to grow by less than 5 percent in 2015 due to the power crunch, which has hit output at mining firms, already grappling with a slide in global copper prices, the government of the southern African nation has said.

Zambia’s energy regulator allowed state power utility Zesco to raise the average price of electricity to 10.35 U.S. cents per kilowatt hour (KWh) from 6 U.S. cents per KWh. The new tariff became effective on Thursday.

However, mining companies were unaffected by the increase because most of them get their power from Zambian power supplier Copperbelt Energy Corp. which buys electricity from Zesco in bulk and sells it to mining companies including the local units of Vedanta Resources and Glencore.

“Today’s increase in electricity tariffs is a key part of laying the foundation for needed investments in new power generation,” IMF country representative Tobias Rasmussen told Reuters.

“The move, on its own, does not ensure full cost recovery in electricity provision, but this is an important step towards putting the power sector on a sustainable footing and overcoming the electricity shortages that have plagued the economy.”

Zesco Ltd had applied for the higher tariffs in October, saying it had to increase the price of electricity due to rising costs and a depreciation of the kwacha currency, which had pushed up import prices.

Zambia’s electricity deficit rose to 985 megawatts (MW) in September from 560 MW in March as water levels in reservoirs at its biggest hydropower station fell due to drought.

Zambia’s power generation capacity stands at 2,200 megawatts (MW), with the bulk of the electricity produced from hydropower, but supply is often erratic. Zambia’s output fell to 1,900 MW in March due to low water levels in dams.

 

(By Chris Mfula. Editing by James Macharia and Mark Potter)

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Eskom applies to regulator to recover $1.6 bil via tariffs

12 November 2015 Comments (0) Africa, Business, Latest Updates from Reuters

CAPE TOWN (Reuters) – South African utility Eskom has asked the energy regulator to allow it to recover $1.6 billion in costs from 2013/14 when it ran expensive diesel plants and brought more green power to keep the lights on.

The regulator (NERSA) in Africa’s most advanced economy in June rejected a request from cash-strapped Eskom to raise tariffs and the utility said it would seek alternative ways of funding.

Eskom’s spokesman Khulu Phasiwe said the utility was over budget as it had to buy an extra 1,800 megawatts of green energy and used more diesel to run its expensive plants in 2013/14.

The regulator said it was assessing Eskom’s request and did not say when it would publish its outcome.

“Should the results of the assessment indicate that Eskom has to reimburse the customers then the price of electricity would have to decrease. Similarly, if the customers have to reimburse Eskom the price would have to increase,” National Energy Regulator spokesman Charles Hlebela said.

Eskom, which provides virtually all of South Africa’s electricity, is scrambling to repair its ageing power plants and grid. Earlier this year, the utility was forced to impose almost daily power cuts that hurt economic growth.

Eskom said last week, however, that it does not expect to implement electricity blackouts until April 2016.

The energy regulator could grant Eskom the full 22.8 billion rand ($1.6 billion) it wants to recover, or a portion thereof, with customers ultimately bearing the cost.

Independent energy analyst Ted Blom said if the full increase was granted, consumers could expect to pay between 11 and 15 cents extra per kilowatt/hour for electricity.

 

(Reporting by Wendell Roelf and Peroshni Govender; editing by David Clarke, Reuters)

 

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Access Infra Africa signs plan for $100 mil Nigerian solar plant

10 November 2015 Comments (0) Africa, Business, Latest Updates from Reuters

ABUJA (Reuters) – Access Infra Africa has signed a joint development agreement with Nigerian Quaint Global Energy Solutions for a 50 megawatt solar power plant that is expected to provide electricity for over 600,000 homes in northern Nigeria, the partners said on Tuesday.

The west African nation has chronic power shortages due to a dilapidated transmission grid and natural gas constraints while the new generating and distribution companies are still struggling to be profitable since the 2012 privatisation of the sector.

Power output has risen since President Muhammadu Buhari was inaugurated at the end of May, fluctuating at just under 4,000 MW per day over the last few weeks versus just over 3,000 MW under the former administration, according to transmission data. But the level is still far below the country’s needs.

Businesses rely heavily on expensive diesel generators while the average Nigerian must put up with days of blackouts.

The ABIBA plant in northern Kaduna state is expected to be built in the next two years though the partners must still negotiate a Power Purchase Agreement (PPA) with the Nigerian Electricity Regulatory Commission (NERC) before it can seek financing from banks.

Access Infra Africa, a renewable power developer with a presence in 17 African countries, will contribute the bulk of the 30 percent equity put down for the $100 million project.

Quaint has also received a $1.3 million grant from the U.S. Trade and Development Agency for ABIBA.

If successful, the solar farm would be the first in the country and largest such plant on the continent outside South Africa.

Other renewable energy projects became stuck in the PPA phase under the previous administration and stalled due to an unprofitable tariff but the NERC announced a new feed-in tariff at the start of November for renewable projects up to 30 MW.

Buhari has made increasing power generation a priority as better access to power will be key to his goal of diversifying the economy.

 

(Reporting By Julia Payne; editing by Susan Thomas)

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South Africa’s Vodacom lifts H1 profit on data boom

9 November 2015 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South African mobile phone operator Vodacom on Monday reported a 6 percent rise in half-year profit, buoyed by sharp growth in data revenue.

The South African unit of Britain’s Vodafone has spent billions to expand its network in recent years with a strong focus on providing faster internet to its customers as more of them get smartphones.

“We’re becoming more of a big data provider, an internet provider if you like,” Vodacom Group Chief Executive Shameel Joosub said in a conference call with reporters.

The company said headline earnings per share – the main profit measure in South Africa and strips out certain one-off items – rose to 440 cents from 415 cents, in the six months ended Sept. 30.

Data revenue was up 33.5 percent as Vodacom increased 4G coverage in its home market, the company said.

“In South Africa, LTE/4G coverage increased from 32.2 percent to 46.8 percent,” said Joosub.

Customers that have access to 4G have increased to nearly 2 million in Africa’s most advanced economy and they use almost three times more data than those stuck with lower speeds, Joosub said in a statement released with the results.

The company is forming partnerships with content providers to get its customers to consume more videos and music on smart devices as it tries to rake in more data revenue.

“We need to play more in the content space,” Joosub said.

Vodacom’s smartphone users consume around 425 MB of data per month, compared to 2 GB in the U.S. and Britain which Joosub sees as an opportunity for growth.

Shares in Vodacom were up 1.5 percent to 150.73 rand by 0755 GMT.

 

(Reporting by TJ Strydom; Editing by James Macharia, Reuters)

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Siemens could expand Egypt power deal, says CEO

1 November 2015 Comments (0) Business, Latest Updates from Reuters, Middle East

FRANKFURT (Reuters) – Siemens could win an expansion of its record 8 billion euro ($8.8 billion) power deal with Egypt, the German industrial group’s chief executive said in a staff newsletter.

Joe Kaeser said Egypt, whose state-run electricity grid is creaking under the weight of fast-growing demand, needed extra capacity before the start of the hot summer months – faster than Siemens could build new turbines under the existing deal.

“We had to come up with a good plan as to how we could help – and this plan pleased the president,” Kaeser said after a trip to Egypt during which he met President Abdel Fattah al-Sisi.

“We have a handshake on which we can build,” he added in the interview with Siemens Welt seen by Reuters on Friday.

The extra capacity would be 800 megawatts, which would be produced by upgrading existing power stations and putting into place decentralised power-generation units, Kaeser said. He did not say how much the deal could be worth.

The 8 billion-euro deal signed in June was for 16.4 gigawatts and is designed to boost Egypt’s power-generation capacity by 50 percent after going online in 2017.

 

(Reporting by Georgina Prodhan; Editing by Mark Potter, Reuters)

 

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South Africa boosts power output after maintenance

15 October 2015 Comments (0) Africa, Business, Latest Updates from Reuters

JOHANNESBURG (Reuters) – South Africa added 1,286 megawatts (MW) to its national grid on Thursday when two generating units were brought back online following an extensive “overhaul”, power utility Eskom said.

Eskom said electricity supplies would continue to be tight as it carried out other plant maintenance.

South Africa, the continent’s most developed economy, suffered almost daily power outages earlier this year as ageing power plants struggled to meet demand. South Africa’s national generating capacity is around 42,000 MW.

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Kenya’s KenGen says full-year pretax profit more than doubles

13 October 2015 Comments (0) Africa, Business, Latest Updates from Reuters

NAIROBI (Reuters) – Kenya’s main electricity generator KenGen said on Monday its pretax profit for the full year to June rose 109 percent to 8.69 billion shillings ($84 million), helped by higher electricity sales.

KenGen, which is 70 percent state-owned, said in a statement its performance was boosted by increased generation from geothermal and wind power.

“Profit before tax increased … propelled by capacity growth, improved performance and tax credit from capital allowances enjoyed by the company following the commissioning of 280 MW geothermal plants, well heads and Ngong Wind,” it said.

It said electricity revenue jumped to 25.6 billion shillings from 17.4 billion the year before.

Earnings per share rose to 5.24 shillings from 1.29 shillings during the year to June 2014 and it said it would pay a dividend of 0.65 shillings per share, up from 0.40 shillings previously.

Operating costs rose to 8.41 billion shillings from 7.02 billion due to operating and maintaining new plants.

KenGen said in July it planned to add another 450 megawatts (MW) to the grid from wind and geothermal in the next three years at a cost of at least $710 million. [ID:nL8N0ZN29V]

Kenya, which depends heavily on renewables such as geothermal and hydro power, aims to expand installed capacity to about 6,700 MW by 2017, from about 2,500 MW now. It also aims to halve bills from between $0.17 and $0.18 per kWh within three to four years.

 

(Reporting by George Obulutsa; Editing by David Holmes, Reuters)

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