9 October, 2023
President Mokgweetsi Masisi, on Friday led officials in the groundbreaking ceremony for the multi-billion pula Mmamabula coal project that will be built and operated by Jindal, laying foundations that will make Botswana energy sufficient.
The groundbreaking ceremony comes after the Botswana government, through the state-owned power utility, Botswana Power Corporation (BPC), signed a Power Purchase Agreement (PPA) with the Independent Power Producer (IPP) Jindal Steel and Power Ltd. on 25 July 2023. The deal is expected to bolster the country’s power security and also supply the rest of Southern Africa region, which has struggled with power deficiency.
In November 2022, Botswana picked Jindal from the three short-listed bidders to build its planned 300MegaWatts (MW) coal-fired power plant. The country’s minister of Minerals and Energy, Lefoko Moagi, said the 30-year deal will enable Botswana to supply power across the Southern African region, which is struggling with crippling power deficit.
Although the initial deal was for 300MW, this has since been doubled to 600MW planned capacity.
Through the IPP, Jindal will carry the costs of building the power station, running and maintaining it, while selling power to BPC under an agreement known formally as a Power Purchase Agreement (PPA).
Botswana has over 200 billion tonnes of coal resources, and its energy demand is expected to rise from 600 MW currently to around 800 MW by 2028, while its power supply is forecast to grow from just over 500 MW to over 1,000 MW. Under a 20-year plan approved in 2020, Botswana was planning to add more than 600 MW of solar and coal-fired power by 2026, but Moagi said the plan has been revised to add more power plants.
“We recently got approval from the cabinet to add another 300 MW to this greenfield project, taking it to 600 MW,” Moagi said at the signing of an initial 300MW Power Purchase Agreement for the plant.
“This will come in handy to address the power deficit in the region, as we do not only seek to become self-reliant, but also be a net exporter of electricity.”
Under the original deal, Jindal agreed to spend $1billion to build a 4.5million tonne per annum coal mine and the power plant, recouping its investment from selling electricity to BPC over a 30-year period. The minister said the revised procurement was part of several updates made to the Integrated Resource Plan (IRP), the government’s blueprint for electricity procurement between 2020 and 2040, with a target of generating at least 30% of national production from renewables by 2030.
Jindal Steel and Power Chairman, Naveen Jindal, said while the 300MW plant had been due to complete by the first quarter of 2028, the Indian group’s experience meant the project could be finalised by 2026. Jindal has more than 15,000 MW of generation and coal assets in countries around the region.
“Our plan is to finish this project by 2026 instead of the agreed 2028,” Jindal said at the signing ceremony.
“There is no reason why Botswana, with all its coal resources, cannot supply the whole region and address the shortages in South Africa. We should explore the possibilities of going beyond the 600MW plant.”
BPC CEO, David Kgoboko, said that by the time of its completion, the 300MW plant would increase Botswana’s total baseload power to 820MW, with the inclusion of power generation from Morupule A and B.
“This is the first base load PPA in the country and will become a pivotal addition to our energy mix as we add more renewable energy sources. It will undoubtedly enhance security of supply which currently hinges on the performance of our Morupule B power station,” said Kgoboko.
“This PPA signifies BPC’s commitment towards the successful implementation of the integrated resource plan aimed at making Botswana a net exporter of power with optimal energy mix consisting of fossils and renewables,” he said.
Source: https://www.sundaystandard.info/jindal-breaks-ground-to-kickstart-600mw-coal-power-plant/
