Malawi: Chinese Ambassador Says Kam'mwamba 300MW Coal-Fired Power Plant Project Still On

24 April 2019

Ambassador of the People's Republic of China Liu Hongyang said the on the 300 megawatts (MW) Kam'mwamba Coal-Fired Power Plant Project in Neno, with a lifespan of 30 years, is still alive and some studies are still underway.

He was speaking in Lilongwe on the sidelines of the Belt and Road Initiative (BRI), as part of the preparations for Second Belt and Road Forum for International Cooperation (BRF) which is to be held in Beijing from April 25 to 27, the country's development in the past 70 years as well as prospects of China-Malawi relations.

Kam'mwamba Coal-Fired Power Plant Project is being financed by a loan from Export and Import(Exim) Bank of China to the tune of $667 million project with Lilongwe required to source $104million as commitment fee.

A year down the line after Lilongwe announced the financiers of the project, little or nothing seems to be done for the project, which will be the biggest investment in the energy sector to take about three years, and raises hopes for improved power supply in the country and is critical to attract investments, particularly in the mining sector.

"Kam'mwamba Coal-field Power Project is still alive and there, what we are doing is that we are doing some visibility studies on some infrastructure like roads, railways systems and other things to enable easy transportation of coal as well as distribution," Hongyang told journalists in Lilongwe

A report on the project published in 2017, said lack of a feasibility study, the Power Purchase Agreement (PPA) and the creation of the company to operate the project were some of the issues that were still standing in the way for the project to commence.

A team of experts visited China in 2017 for two weeks, negotiating with China Gezhouba Group on the project.

Once fully operational, the plant would among other things help Malawi to diversify from using hydro power which of late has proved to be challenging due to low water levels

According to report from Ministry of Energy, the plant would use coal from Moatize in Mozambique that will be transported by rail.

Dean of Faculty of Built environment at the Malawi Polytechnic, who is also an expert on land related issues, Rodrick Chilipunde described the development as a good direction in terms of adding up power generation capacity to meet the ever growing demand from consumers.

He expressed dissatisfaction over the importation of the coal from Mozambique to run the plant describing it as costly.

The project is expected to be implemented under the Engineering, Procurement and Construction (EPC) model, which is a particular form of contracting arrangement used in big projects where the contractor is responsible for all the activities from design, procurement, construction to commissioning and handover of the project to the end user or owner.

Energy consultant Grain Malunga, who is also former minister of Natural Resources, Energy and Mining, said completion of the project is critical, arguing that it has potential to improve electricity supply in the country.

"We see the project boosting the energy sector. You may wish to know that the deposits [of coal] are enormous. It is pleasing that the project is taking shape because these are the resources we should have tapped long time ago," he said.

Malawi Confederation of Chambers of Commerce and Industry (MCCCI), which has complained of subdued production due to power deficit, has called for speedy implementation of the project, as power outages have taken a toll on industrial output.

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