Mozambique ignites energy sector with solar and hydropower investments

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With 187 GW, Mozambique has the largest potential power generation capacity in southern Africa. In addition, while hydroelectricity, coal, natural gas and solar each continue to increase their respective share in the country’s energy mix, Mozambique is positioning itself as a major regional producer of electricity. Despite prolific power generation potential, Power Africa notes that Mozambique’s electricity access rate was only 31.1% in 2020, due to unfavorable market conditions and transmission grids and limited distribution. As a result, the country holds significant potential for the development of national infrastructure, in which the government’s priorities regarding grid expansion in rural areas, construction of power infrastructure and additional generation facilities create opportunities for investment for private and public sector actors.

Hydropower leads the way

Mozambique’s main source of electricity generation comes from its vast hydroelectric resources. The country’s hydropower potential stands at around 12,500 MW – the largest in sub-Saharan Africa. The Cahora Bassa hydroelectric power station is one of Mozambique’s most important renewable energy achievements and its main source of electricity generation. The 2,075 MW plant is the largest hydropower plant in sub-Saharan Africa, providing vital electricity to the country and the region as a whole. Operated by independent power producer (IPP) Hidroélectrica de Cahora Bassa, the installation not only positioned Mozambique as a major facilitator of Africa’s energy transition, but also highlighted the resource’s potential to meet regional energy needs. Cahora Bassa exports approximately 73% of the electricity produced at the facility to members of the Southern African Development Community through the Southern African Power Pool. As a result, Mozambique only uses 500 MW nationally, which highlights the need for alternative power generation solutions to meet growing domestic demand.

In addition to the Cahora Bassa power plant, there are currently five other hydroelectric facilities operated by the privatized national utility, Electricidade de Moçambique (EDM), which supply electricity to Mozambique’s national grid. These include the 52 MW plant in Mavuzi, 38.4 MW in Chicamba, 16.6 MW in Corumana, 1.9 MW in Cuamba and 0.73 MW in Lichinga. With other proposed projects in the pipeline, including the 1,500 MW Mphanda Nkuwa project and the 1,245 MW North Shore expansion at Cahora Bassa, Mozambique is prioritizing the development of its hydropower resources, serving as a model for other African countries rich in hydropower.

Solar presents off-grid solutions

One of the main challenges hindering socio-economic growth in Mozambique is the low rate of access to electricity in rural communities. With only 27% of rural households currently connected to the national grid, the Mozambican government is prioritizing grid expansion and alternative energy solutions to address these gaps. As a result, solar power has been identified as the most efficient source of electricity generation, especially for remote areas where grid connection is not possible.

Estimated at 2.7 GW, Mozambique’s solar potential is largely untapped, presenting significant investment opportunities that could increase electrification and boost connectivity. The country’s current installed capacity is measured at 2.2 MW, of which 70 MW is currently under construction and 300 MW under study. Mozambique’s only large-scale solar installation is the 40 MW Mocuba Solar IPP project, developed by the Norwegian company Scatec Solar.

The project increased the country’s installed photovoltaic (PV) capacity from 17 MW in 2018 to 60 MW in 2021, providing additional electricity to the national grid. In an effort to increase solar capacity, the government has ordered the construction of the 41 MW Metoro solar power plant in Cabo Delgado province. In addition, it launched a call for tenders for the development of three solar photovoltaic projects in 2020 – adding 120 MW to the national grid – and five additional solar mini-grids in 2021 – which would create an estimated production capacity of between 75 and 230 peak kilowatts. . By prioritizing solar developments, Mozambique is increasing the sector’s share in the energy mix, creating a feasible and off-grid solution for a large part of the population and increasing the penetration of renewable energies in the market.

Natural gas to improve indoor capacity

With the third largest reserves in Africa, natural gas will play a critical role in meeting Mozambique’s national electricity demand. The country has approximately 125 trillion cubic feet of proven gas reserves and is accelerating the development of large-scale liquefied natural gas (LNG) projects in response to growing national and regional energy needs. The billion-dollar LNG developments and associated investments resulting from them not only promise to contribute to electrification initiatives, but also act as poverty alleviation, boosting industrialization and job creation throughout. the country. As a result, gas-electricity solutions are attracting both regional and international interest and associated projects are gaining momentum. Notably, in December 2020, the Mozambique EDM obtained up to $ 200 million from the US International Development Finance Corporation and up to $ 50 million from OPEC for the development of its Central Térmica de Temane project.

The 450 MW gas-fired power plant is expected to be operational in 2021 and will significantly increase the current installed power generation capacity of natural gas, serving as a critical power solution for the country.

With one of the lowest electrification rates in the world – while retaining one of the greatest natural gas and renewable energy potentials in sub-Saharan Africa – Mozambique is rapidly expanding its power generation infrastructure in order to to be able to exploit its resources to meet the national demand for electricity. Subsequently, with small and large scale energy developments both nationwide and in the energy and non-energy sectors, Mozambique’s power sector is at the heart of a transformation that will drive growth and socio-economic success. long-term economic.


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