The United States (US) Ambassador to Malawi, Virginia Palmer, says there are outstanding elements of power sector reforms that remain to be completed if Malawi is to address its power woes.
Her sentiments come less than two months before the $350.7 million [about K257 billion] Millennium Challenge Account (MCA)-Malawi Energy Compact winds up.
The Malawi Compact, which commenced project implementation on September 20 2013, closes on September 20 2018.
In a statement issued on Friday, Palmer says much as the $350.7 million Malawi Compact has laid modern power infrastructure across the country, it was also important for government to ensure that electricity tariffs reflect the cost of supplying as part of broader reforms in the power sector.
“I urge the Government of Malawi and Escom [The Electricity Supply Corporation of Malawi] to ensure that the reforms are fully implemented so that Malawi can bring in private sector investors,” Palmer says.
Palmer says to fully realise the benefits of the Compact, the government should to ensure power sector reforms, including achievement of a tariff rate that reflects the cost of creating and delivering electricity.
Palmer says the compact’s investments make possible the purchase of additional power from Mozambique and Zambia and, more importantly, from new power generation investments in Malawi.
She says by making tariffs cost- reflective, it would help make Escom financially sound, enough to purchase the additional power.
On his part, MCA–Malawi Chief Executive Officer, Dye Mawindo, said his institution is working with all its contractors to ensure that all the projects are finished on time.
“We want to minimise any outstanding works beyond September 2018 to reduce the financial obligations of Escom, Egenco, or the government,” said Mawindo.
Meanwhile, the refurbishment of Nkula A under the Malawi Compact has added 12 megawatts to the national grid on trial basis.
The construction of new substations and approximately 400 kilometers of transmission and distribution lines will allow for efficient transmission and distribution of power throughout the grid.
These infrastructure improvements will also make possible Malawi’s future connection to the Southern African Power Pool so Malawi can buy, and someday sell, power to the region.
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