Maravi

Lack of implementation delays power projects, says Magande

Lack of implementation delays power projects, says Magande
By Joan Chirwa
Wednesday May 07, 2008 [04:00]

THE current problems in power generation have resulted from inadequate implementation of projects and not because of lack of money, finance and national planning minister Ng'andu Magande has said. In an interview, Magande said lack of proper planning and implementation of hydro-power generation projects had in some way contributed to the current power problems being experienced in Zambia.

"Why we have been having delays in the completion of power projects is not really because of money but because of lack of implementation of projects," said Magande in response to proposals that government channel part of the expected revenue from new mine taxes to power generation projects. "For example, the Itezhi-tezhi hydro power project has been dragging even after Zesco Limited and Tata Africa entered into a joint venture to develop the plant. So the issue is not about not having money to finance these projects; it's about the implementation of these projects. There is also the Kafue Gorge Lower power project, which will only be able to generate electricity in the next five years."

There have been calls for government to prioritise financing for hydro-power projects in the country in view of the electricity deficit.

Some stakeholders suggested that government should try and utilise the expected revenue from increased mineral taxes to finance hydro-power projects in the country, as demand for electricity kept outstripping supply resulting from the power utility's inadequate generation capacity.

As a result of inadequate generation capacity to meet the rising demand for power, Zesco Limited earlier this year initiated intensified load shedding throughout the country.

Zesco's current generation capacity stands at around 1,200 mega watts (MW) against a peak demand of around 1,500 MW, since a total of 600 MW have been taken out of the system to facilitate uprating of the equipment.

But Magande said the government could not expressly plan for the windfall tax revenue to finance huge projects in power generation because collections were based on prevailing market conditions on the international markets.

"We cannot mix the mining windfall revenue into the budget because we will not be having a fixed amount every year. It will all depend on the prices of copper on the international market," said Magande.

Copper prices recently hit a record high of US $8,800 per tonne. The new mining tax for the mines is therefore expected to give government around US $415 million approximately K1.5 trillion in additional revenue to the treasury in 2008.

Labels: CONSTRUCTION, CONTRACTORS, MAGANDE, PROJECT MANAGEMENT

posted by MrK @ 6:07 AM