The energy sector in Mozambique is the anchor for diversifying the pyramid of growth and for opening new opportunities, declared the Minister of Industry and Trade, Max Tonela, on Thursday.
He was speaking in the Maltese capital, Valletta, at the end of a session on “Energy Security: Investing in the Future”, ahead of the Commonwealth Summit, due to begin on Friday.
The attention paid to business opportunities in the energy sector, from natural gas to hydropower to renewables, results from the potential that Mozambique has, and also because the 53 member states of the Commonwealth provide Mozambique with a major potential market, said Tonela.
“We presented our experience in making use of the country’s energy potential, and the measures under way to revise the electricity law, in order to attract more investment to the sector”, he added.
Mozambique has immense hydro-electric potential, particularly in the Zambezi Valley, and several large electricity generation schemes have been on the table for years. These include a second power station at the Cahora Bassa dam, and new dams further downstream, at Mpanda Nkua, Boroma and Lupata.
These have not yet been built largely due to lack of cooperation from the South African electricity company, Eskom. Arranging the finance for new dams and power stations depends on having a secure buyer for the energy produced.
Mozambique cannot yet absorb all the power that would be produced, and the only potential buyer in the region for thousands of megawatts is Eskom.
Currently 85 per cent of the electricity consumed in Mozambique comes from hydro-power sources (mostly Cahora Bassa), and the remaining 15 per cent from gas fired power stations. This picture could change significantly in the near future, according to the National Director of Energy, Pascoal Bacela.
Coal fired power stations are included in the plans of several mining companies, exploiting the enormous coal deposits in the western province of Tete, and there are also projects for solar power stations. These will change the country’s energy matrix, and reduce somewhat the percentage of total electricity consumption drawn from hydro-power.
The director of the government’s Investment Promotion Centre (CPI), Lourenco Sambo, said that the industrialization of agriculture requires new processing capacity and greater irrigation, both of which are impossible without energy. He believed Mozambique could learn from other Commonwealth member states about how to anchor development in the energy sector “in order to better diversify the economy”.
Mozambican President Filipe Nyusi will head the Mozambican delegation to the summit, due to last from Friday through to Sunday. In addition to Tonela, he is accompanied by Foreign Minister Oldemiro Baloi, and the Minister of Gender, Children and Social Welfare, Cidalia Chauque.