SADC approves more than US$3m towards regional interconnector project
SADC’s Project Preparation and Development Facility (PPDF), managed by the Development Bank of Southern Africa (DBSA), has approved its first allocation of preparation funding.
This was in the tune of US$ 3.5 million towards the development of the multi country Regional Interconnector Transmission Line Project.
The PPDF is funded both by the German Government (BMZ) financed through the KfW as well as the EU through its regional office in Gaborone. This project will be funded from the KfW contribution. The countries that are set to benefit from this project are Mozambique, Zimbabwe and South Africa (MoZiSA).
Commenting on the significance of the funding approval, Mr Patrick Dlamini – Chief Executive of DBSA says, “This is a historic milestone for the PPDF since its inception and signifies the progress towards attaining its mandate.”
“The purpose of the PPDF is to create a conducive environment for investment through financing the preparation of infrastructure projects based in at least one SADC Member State or those with a direct and positive impact on another Member State,” he adds.
The MoZiSA Regional Interconnector Project comprises the development, construction and operation of a 400kV or 500kV high-voltage transmission infrastructure over a distance of approximately 935km, including transmission lines and associated substations through South Africa, Zimbabwe and Mozambique with the view to facilitate the strengthening of the existing ‘North South transmission interconnection corridor’ in Southern Africa.
The project is sponsored by the member countries’ national power utilities which are Electricidade de Moçambique (EdM), Zimbabwe Electricity Supply Authority (ZESA) and Eskom (South Africa).
The sponsors are represented by the region’s Southern African Power Pool (SAPP), which is the recipient of the US$ 3.5 million preparation funding. The funds for this phase will be used for the appointment of a Transaction Advisor to assist SAPP to execute the development phase of the project.
“Of importance, the long term added benefits of the project will be the alleviation of Eskom’s power supply deficit through the introduction of an alternative transmission route to transmit up to 1000 MW of power from Hydro Cahora Bassa (HCB in Mozambique) to the SAPP electricity grid thereby relieving major constraints that South Africa is experiencing currently,” says Dr Lawrence Musaba, Coordination Centre Manager at SAPP.
The delivery outputs of the Transaction Advisor will be to develop the Project Scoping Study, completing the Bankable Feasibility Study on the Environment as well as finalize the Project Information Memorandum to Financial Close. The estimated time towards achieving this is planned for April 2017.
“We as SADC and our partners DBSA, EU Delegation based in the SADC Regional Office and KfW are excited about this milestone -- more importantly because the outcome of this phase will assist in the development of a multi-national strategy to facilitate trade and improve regional interconnectivity in the SADC region,” concludes Dr T Mhlongo, Deputy Executive Secretary at SADC.