MALAWI– The World Bank has approved grants and loans totalling US$57 million (K42bn) for the Mozambique-Malawi Regional Interconnector Project which will improve access to reliable electricity for Malawians.
Mozambique is expected to receive a grant of US$24 million from a Norwegian trust fund administered by the World Bank and a grant of 20 million euros (US$22.1 million) from the German government.
The project will interconnect the Mozambique and Malawi transmission systems to enable both countries to engage in bilateral and regional power trade in the Southern African Power Pool (SAPP).
In statement, the World Bank says the project will interconnect the Mozambique and Malawi transmission systems to enable both countries to engage in bilateral and regional trade in the Southern African Power Pool (Sapp).
“Of this amount, Mozambique will receive US$41.5m (K30.4 billion) as an International Development Association (IDA) grant. Malawi will receive US$14.75m (K10.8 billion) credit,” says the statement signed by the bank’s regional integration for Africa, the Middle East and Northern Africa Deborah Wetzel.
The project includes construction of a 218-kilometre, 400 kV high voltage alternating current transmission line, grid connections, and associated infrastructure including substation works.
The new line will start at the Matambo substation in the western Mozambican province of Tete, and end at Phombeya substation in Balaka District in southern Malawi.
“With these investments, Malawian households, businesses, and farmers will benefit from increased access to reliable electricity services, that are vital to improve the country’s productivity and competitiveness in the domestic and regional markets”, says the release, while the Mozambican electricity company, EDM said, “will receive additional hard currency revenues, which could be utilised for the country’s ongoing domestic electrification efforts”.
Deborah Wetzel, the World Bank director for regional integration for Africa, the Middle East and Northern Africa, commented: “This is an important project for the region. It will create conditions to expand access to millions of people in the region living without electricity, and help decarbonise the Southern African power systems, which are currently dominated by coal generation.”
The project “responds to Mozambique’s sectoral priorities to emerge as a regional energy hub, by exporting power to Malawi. It also increases the country’s potential for exporting electricity through the SAPP to many other countries in future,” noted Mark Lundell, the World Bank Country Director for Mozambique.