Energy in the Democratic Republic of Congo (2014): The current electricity rationing program highlights a pressing problem

Energy-in-the-DRC-feat

Lubumbashi – The Congo River has the potential to power a Continent – or almost – and yet energy remains the main challenge to miners operating in the DRC.

As a result of power shortages, in March 2014, the government announced an electricity-rationing program for mining companies with SNEL, the state owned power-company, being forced to stop entering into new contracts. The government plans to share power allocation to each mining company according to the duration of the contract, the levels of production and the minimum energy levels required in order to maintain a profitable business. Meanwhile, intermittent power supply shortages result in diminished productivity for mining companies in the DRC with Toronto listed Katanga Mining loosing a total of 1609 hours, or about 67 days, to intermittent power supply in 2012 alone.

Most of the power in the DRC comes in hydroelectric form, with the country’s hydroelectric power potential estimated to be of 106,000 MW/y, the equivalent of 13% of the world’s total. Yet the DRC presently produces only 2,100 MW/y and according to government figures, to cover demand from mining companies in the province of Katanga alone, approximately 900 MW of energy are needed with only 461.7 MW currently being available.

To make up part of this difference, the country currently relies on imports from Zambia with approximately 100 MW/y being available from the State-owned Zambia Electricity Supply Corporation and another 50 MW/y from the Zambia-based Copperbelt Energy Corporation. Indeed, Zambia hopes to become a regional hub for hydro-electricity generation and aims to provide its surplus to neighbouring countries by as early as 2015. Various hydro-electricity expansion projects including Kariba’s North Bank extension (360 MW) and the Maamba power plant (300 MW) which should start to generate electricity by the end of 2014 are underway to help achieve Zambia’s expansion plans. Other noteworthy projects in Zambia include the Itezhi-Tezhi Hydro Power Project (120 MW)  (February 2015) and the Kafue Gorge Lower Hydro Project (750 MW) (December 2021).

In the DRC, with the World Bank board recently approving a grant of $73.1 billion to help the country fund the development of the Inga III Base Chute hydroelectric dam, plans are equally impressive. The grant, combined with African Development Bank’s investment of $33.4 million in late 2013, will finance the environmental and social impact assessment of the project and will be used to conduct a comprehensive technical study to ensure the dam’s sustainability.

Three international consortiums, including the Three Gorges Corporation of China, are bidding for the contract to build Inga III, and sell the power it generates, estimated at 4,800 MW/y. This is nearly three times the amount of power produced from Inga 1 and Inga 2 that currently stands at, respectively, 351 MW/y and 1424 MW/y. Under the current plan, according to the World Bank, South Africa would purchase 2,500 MW/y from the power generated from Inga III with another 1,300 MW/y being available for DRC’s mining industry and the remaining 1000 MW/y going to SNEL to help provide power to an estimated 7 million people around Kinshasa and covering all the projected unmet electricity needs there by 2025.

However, the project is far from becoming a reality yet. The World Bank said its technical assistance funds will not go towards construction or operation of the dam and stated that it had not yet decided on whether to support the construction of Inga III, which is proposed to cost $12 billion. Success for Inga III would however help raise investors’ confidence in the remaining five stages of the Grand Inga project which, once completed, would produce 44,000 MW/y, dwarfing all other hydro-electric projects in the world including China’s Three Gorges Dam.

Meanwhile, the government in the DRC has decided to open operation and maintenance of Katanga’s high-tension networks to private third parties and the Parliament recently passed a law liberalising the electricity industry, which, once ratified, will allow for private investment in new projects.

In February 2014, the government also postponed a ban on exports of concentrated copper and cobalt because it lacks the power to process the minerals to 2015 and with mining investors’ in Katanga having already spent or pledged to spend more than $600 million to improve power supply in the country plans on paper so far look promising. However, the time required for large infrastructural developments, like the Inga III Base Chute hydroelectric dam, means that the availability of power in the country will remain a challenge for yet some time to come.