President Edgar Lungu has said that government is aware of the impact that the current load shedding has had on the economy and that is why he is personally leading a robust response to ensure this situation is normalized.
Speaking during the handover of the Kafue Gorge Lower Project site to the contractor Sinohydro Corporation of China at Kafue Gorge today, President Lungu said that he will next month be commissioning the 100MW power station at Itezhi Tezhi.
President Lungu said that the Kafue Gorge Lower project is estimated to cost two billion United States dollars inclusive of financing costs.
Below is the full Speech he Delivered at the handover site
- Your Excellency the Chinese Ambassador,
- The Minister of Energy and Water Development, Honourable Dora Siliya,MP
- Cabinet Ministers present
- Deputy Ministers Honourable Members of Parliament
- Permanent Secretaries Present
Government officials present
- Your Royal Highnesses
Delegation from Sinohydro Corporation
- Acting Managing Director-ZESCO Limited
- Invited guests
- Members of the Media
- Ladies and Gentlemen
It gives me great pleasure to officiate at this important occasion which marks the official handover of the 750mw Kafue gorge lower hydropower project site to the sinohydro corporation limited of the peoples republic of china.
This special occasion marks a very important milestone in the history of our country as it is designed to add great value in increasing the generation capacity of power supply to our national grid considering the current challenges being faced as a result of the power deficit.
Ladies and Gentlemen
This project, with a capacity of 750mw, is being implemented by the government of the Republic of Zambia (GRZ) through the ministry of energy and water development and ZESCO limited under a special purpose vehicle called Kafue Gorge Lower Power Development Corporation Limited.
This long awaited project will go a long way in mitigating the enormous power deficit the country is currently experiencing. The power station will be the third (3rd) largest in Zambia after the Kariba north bank and Kafue gorge power stations which have installed capacities of 1,080mw and 990mw respectively.
The scope of the project includes construction of:
- 140m High Dam
- Water tunnels
- Surface Power House
- Workers’ township
- Primary and Secondary School, and
- Many other community social amenities
- Ladies and Gentlemen,
The project is estimated to cost two billion united states dollars ($2,000,000,000) inclusive of financing costs. I am happy to mention that my government managed to provide an initial one hundred and eighty six million ($186,000,000) united states dollars to ZESCO as part of the initial equity and investment contribution to kick- start the project.
This contribution was allocated from the 750 million Eurobond, which the government obtained to finance infrastructure development. Those doubt our resolve to address the power shortage must know that this is a very serious matter to us. It is not about politics and point scoring, it is about one ensuring that energy security is assured because this is extremely important for socio-economic development.
Let me use this opportunity to emphasise the point that when we turn to bilateral partners and to open markets to borrow, we do so judiciously, we do so to borrow for essential investment like this one. The nation must be reminded that even the existing power infrastructure at Kariba and Kafue power stations was financed through external borrowing.
I must make this point to ensure that those who oppose development for the sake of seeking cheap political gain must know that we have truthful alternative explanation to give them. Those opposing essential borrowing like simply want to keep people in dark, to ensure the current load-shedding continues to afflict our people and out of that suffering they see a possibility of making political gain.
This is a viable project with assured market for its product and therefore recouping the investment we are making is assured. This project also assures us of sustainable energy security as a nation because it will add a significant amount of power to the grid. This is just, but one of the fast-tracked interventions I have directed to ensure that we get out of the current power shortages as soon as possible.
I will next month be commissioning the 100mw power station at Ithezi Tezi.
My government is expected to provide 15% of the project cost equity funding while the contractor shall assist in arranging 85% of the total project cost as debt financing from the china exim bank and industrial and commercial bank of china (icbc).
Ladies and Gentlemen,
This project will create about 5,000 jobs at the peak of construction. This project will create business opportunities for suppliers of goods and services to benefit the local communities and the country at large.
This is why I wish to urge all Zambians to be patient in the wake of current power deficits as my government is working hard to ensure reliable and quality power supply is guaranteed soonest.
My government is aware of the impact that the load shedding has had on the economy and that is why I am personally leading a robust response to ensure this situation is normalised. It is our responsibility to ensure that the wheels of the economy continue to turn and one major input into running of our economy is reliable power supply.
Ladies and Gentlemen,
The project land for the upcoming power station is located in three chiefdoms namely Naluama, Nkhomeshya and Sikoongo. I wish to take this opportunity to extend my gratitude to Her Royal Highness Chieftainess Nkhomeshya Mukamambo II and his royal highness chief naluama for consenting to the land application for the project.
My government is keen to ensure that the local people beneffit from this project. It is a matter of right that local people must have access to the electricity that will be generated from this power station. The days when local people only saw transmission lines passing over their heads and land transmitting electricity to areas far away are long gone.
To this effect, I direct the ministry of energy and water development and ZESCO to ensure that the areas surrounding this project site are electrified to so they benefit directly from the electricity that will be produced here.
Ladies and Gentlemen,
During the feasibility study of the project, 25 families were found to have settled in this project land whose livelihood activity was fishing. My government provided finances to compensate and resettle these families in places of their choice under the Resettlement and Compensation Action Plan (RAP). New houses and other social amenities were built for the affected people.
The rap facilities have since been handed over to the community in line with government policy of empowering its citizens with decent shelter.
I am informed that the procurement process for engagement of the contractor for this project was done through international competitive bidding process.
Ladies and Gentlemen,
Let me take this opportunity to congratulate sinohydro corporation of china for wining the tender to build this power station. This is Zambia’s first major power investment in 40 years! It is regrettable that valuable time was lost in unnecessary red tape and accusations and counter-accusations of wrongdoing leading the cancellation of the project several times. Had we acted decisively then we would not be facing the kind of shortage before us today. But as I said during my press conference last thursday, as head of state, I bear the responsibility to take decisive steps to address these problems.
As we move to diversify the country away from over-dependence on copper, I also wish to ask all citizens to help your government diversify the country away from over-dependence on Hydro power. I make this appeal because there is a lot individuals can do to help conserve power. As we introduce other alternative sources of power let us ensure that we address the demand side of this power equation.
Given the stark realities of our situation, I want to urge the contractor to expedite works and deliver the project on time.
On our part, I want to pledge total government support to ensure that the project is completed in a timely and cost effective manner.
Ladies and Gentlemen,
It is now my singular honour to officially handover the Kafue gorge lower Hydro power project site to Sinohydro corporation to commence the construction works.
May the almighty god bless you all
I Thank You
All Pictures by Jean Mandela