Zimbabwe licenses five private power producers

Zimbabwe has licensed five independent power producers whose projects are aimed at helping a struggling power sector by doubling current electricity output to 4,450 megawatts, a government minister said on Friday.

Power shortages have hurt mining and industry in the southern African state slowly recovering from hyperinflation that crushed the economy about two years ago.

Energy and Power Development Minister Elton Mangoma told Reuters that Zimbabwe had also secured $30 million from the African Development Bank (ADB) to fund maintenance at the states's main Hwange Power Station.

They said they would make $30 million available, which will be channelled mostly to Hwange, he said.

Hwange's six generating units have a capacity to produce 950 megawatts but the whole station is currently producing only about 40 percent of that.

We still have to sit with ADB to decide other areas where the money will have the greatest impact, but as I see it, there is a critical shortage of skills and we need more money for spares, Mangoma said.

Mangoma, a minister from Prime Minister Morgan Tsvangirai's Movement for Democratic Change party, said Zimbabwe wanted to bolster its power grid and transmission systems.

We have also licensed a number of independent power producers in the last few months that will come on stream in the next three to four years, he said.

The new plants will have a collective capacity of 4,540 MW, more than double the current 2,000 MW capacity.

Zimbabwe, whose mining firms are major power consumers, now needs about 2,700 MW and imports an average of 300 MW from neighbouring countries.

Its other major energy plant, Kariba Hydro Power Station, has a capacity of 750 MW but is undergoing maintenance that has reduced its capacity by half.

A unity government formed between Mugabe and Tsvangirai in 2009 brought stability to the economy, which contracted most of the past decade due to what analysts see as gross mismanagement by Mugabe's ruling ZANU-PF.

We have one of the most advanced legislations on the continent on power management but our political and economic situation was such that it was hard to attract any investment, said the minister.