Mozambique: Access to Electricity Fundamental, but Not Free

Maputo — Mozambique’s Minister of Mineral Resources and Energy, Pedro Couto, on Thursday declared that increasing access to electricity is a fundamental priority for the government – but the electricity must still be paid for.

Speaking in the Mozambican parliament, the Assembly of the Republic, in reply to a question from the opposition Mozambique Democratic Movement (MDM) about what it termed “a general crisis in the supply of electricity”, Couto stressed that the companies which generate and transmit electricity must act in an economically rational fashion.

  • An electricity company “operates as an economic unit, and there is no alternative to this”, he insisted. “To say otherwise would be pure demagogy, and the companies would be unsustainable”.

    Opposition speakers the previous day had denied the government slogan that “Cahora Bassa is ours”, apparently because the largest slice of the power produced at the Cahora Bassa dam on the Zambezi is exported to South Africa. But Couto thought it absurd to argue that electricity companies “must not be involved in foreign trade”.

    On the contrary, involvement in the southern African energy market was essential. Mozambique was a member of the Southern African Power Pool (SAPP) “and we’re not going to leave it”.

    Couto pointed out that Mozambique could not build a new dam based solely on its own electricity needs. It would make sense to build a dam that could generate 1,500 megawatts, but there must be buyers for this power, and they could not be found in Mozambique alone.

    He insisted that “Cahora Bassa is indeed ours”. The company operating the dam, HCB, “belongs to us, but it must be sustainable, and it must respect the contracts it has signed” (the largest of these contracts, and the one which guarantees HCB’s financial health, is with the South African power utility, Eskom).

    Couto rejected the claim made by MDM deputy Venancio Mondlane that there has been no rural electrification, because the district capitals electrified over the past decade are all supposedly urban. Couto pointed out that, on the way to the district capitals, the power lines also supply smaller places, such as administrative post headquarters, localities and even villages.

    So far the public electricity company, EDM, had electrified the capitals of 125 of the 128 districts that existed when the plans were drawn up (subsequently some districts have been split in two, so there are some new district capitals that need electrification).

    Couto pointed out that during this work, 295 administrative posts, localities and villages had received electricity. This year the remaining three district capitals, seven other small towns and 20 administrative osts would be connected to the national grid.

    But the power was not free of charge. “The consumers sign contracts as clients of EDM”, said Couto. “That’s how things work”.

    Couto also told the Assembly that a wildcat strike against redundancies at the dredge mine in Moma, on the coast of the northern province of Nampula, operated by the Irish company Kenmare Resources, ended on Wednesday, and the strikers have returned to work.

    Couto said the problem for Kenmare was that the prices for the minerals it mines at Moma (ilmenite, rutile and zircon) have fallen sharply, and the Chinese market for these minerals has shrunk by 12.5 per cent.

    Cost cutting measures, such as redundancies, were thus inevitable. At first Kenmare wanted to sack 375 of its workforces, but after tripartite discussions between the company, the workers’ trade union and the Labour Ministry, the number of redundancies was scaled back to 160.

    “The workers received their redundancy pay and an extra bonus of between 15 and 60 per cent”, said Couto.

    This was not enough to avoid the unofficial strike which broke out on 24 June. Couto said the police only intervened to clear the entrance to the mine and none of the strikers were injured or killed.

    “Companies working in mining and energy must be sustainable”, said the Minister. “When they run into labour problems, these are solved in tripartite negotiations”.

    Not Ready to Buy or Sell Your Equipment?

    Join our international network of oilfield buyers & sellers! 
    We respect your privacy as well as your time and that's why we only send our newsletter no more than TWICE A MONTH.
    Two emails per month (maximum). No ads. No affiliate links.