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Lloyd Gumbo Senior Reporter
Construction of a 600MW thermal power station at Gwayi took a step in the positive direction after the Zimbabwe Energy Regulatory Authority approved a Power Purchase Agreement (PPA) between the Zimbabwe Electricity Transmission and Distribution Company and China Africa Sunlight Energy (CASECO).

The firm is a consortium of a private Zimbabwean company, Oldstone Investments and Shandong Taishan Sunlight Investments of China.

The two firms signed an integrated project worth over $2 billion during President Mugabe’s fruitful state visit to China in August.

The integrated project includes constructing the Gwayi-Insukamini Power Station Transmission line, coal extraction, construction of the Gwayi-Shangani Dam and an industrial park.

Zera chief executive Engineer Gloria Magombo confirmed the development yesterday, saying all power project agreements of an investment nature were supposed to be brought before the regulator to check if the agreement complied with the country’s tariff regime and international best practices among others.

“Yes, the Zera board in consultation  with the minister, as required by the law, approved the PPA because what we do is to review and see whether or not it complies with the nation’s tariff, risk allocation and international best practices and they met those,” she said.

“The same document is then taken for finalisation with financiers of the project for financial closure. The financiers will not approve a project where the PPA has not been approved. They will also do their own feasibility studies.”

CASECO deputy general manager Retired Colonel Charles Mugari said approval of the PPA by Zera allowed them to engage funders for financial closure.

“Our people are already on the ground but we are hoping to start sinking of the first mining shaft by mid-November and by April the first shaft must be completed then the other two from then on.

“We will do construction of the coal mine, power station… the first 300MW and accommodation for staff concurrently. Our plan is to make sure that by the first half of 2017, we will have 300MW on the national grid with the other 300MW coming up at the end of 2017.”

He said funding for the first part of coal mining was already in place while they were finalising negotiations for financial closure with the funders.

Zim-Asset identifies energy and power development as key enablers to productivity and socio-economic development.

President Mugabe’s visit to China saw several multi-million dollar deals especially in the energy and infrastructure development sectors being sealed.

Barely a week after his return from China, President Mugabe commissioned the construction of the Kariba South Power Expansion Project to the tune of $533 million.

The deal for the expansion of Hwange Thermal Power Station that will add 600MW to the national grid was signed by Zimbabwe Power Company and Sinohydro of China last week.

The three projects are expected to add 1, 200MW to the national grid by 2017 while in the short-term solar projects are also on the pipeline.

Tenders have also been opened for 300MW solar projects in Gwanda of which when the three projects are completed that will see the national output surpassing the country’s current peak demand of about 2 200MW.