Electricity Supply Corporation of Malawi (ESCOM) has spent K117 billion on Aggreko diesel generators over the four past years, with K80 billion of the total amount being used to purchase diesel for the generators.
ESCOM Director of Finance Clement Kanyama revealed the figures during a press briefing which ESCOM together with Minister of Energy Ibrahim Matola held in Lilongwe yesterday.
Kanyama said K4.5 billion was spent on energy and K32.7 billion was spent on capacity. ESCOM was also required to purchase diesel and over the past four years, K80 billion worth of diesel has been purchased.
He noted that ESCOM was paying Aggreko a huge a mount of money every month relating to capacity and also buying fuel for the generators. This was happening even during months when hydropower generation was high.
According to Kanyama, during any three months, Electricity Generation Company (EGENCO) provides 93 percent of the electricity in the country, Aggreko provides two percent, EGENCO diesel plant provides one percent and JCM Solar provides one percent.
Despite EGENCO providing a huge chunk of the available electricity, it only takes out 70 percent of the resources available to power producers.
“Whereas Aggreko takes out 17 percent of the resources.
“When you look at that, as a country you reflect on what is the best way to use our scarce resources. It is the decision of government that government should have its own standby generation capacity,” said Kanyama.
He added that this is the reason EGENCO has over the past weeks floated tenders for projects on standby generation capacity. He further said that the projects EGENCO will invest in will effectively and cost-efficiently replace Aggreko.
Aggreko’s generators were providing 78 Megawatts of electricity and there have been concerns that the end of the deal will lead to prolonged blackouts in the country at a time Malawians are already experiencing 6 hours of blackouts per day.
However, Kanyama said the capacity to produce the 78 Megawatts is there in the country even though the machines cannot be run for 24 hours a day.
“We are going to replace the loss of 78 Megawatts through a combination of 30 Megawatts which EGENCO will invest in plus gas turbines, showing that on average we are bringing in 30 to 35 Megawatts into the grid on a daily basis,” said Kanyama.
