Kudu Power application shrouded in secrecy
Prospective power producer Kudu Power Company has been forced to re-apply for an electricity generation license the Economist has learned. The spanner in the works relates to a lack of information provided on the part of Kudu Power.
In a letter sent to Africa Renaissance Consortium, a soon to be established advocacy group by the Electricity Control Board of Namibia, the re-application for an electricity generation license stems from Kudu Power’s desire to withhold certain information from the public domain. An investigation by the Electricity Control Board has forced Kudu Power to re-advertise its application following complaints received against the application.
Responding to the query, Electricity Control Board Chief Executive Officer Foibe Namene said, “The application solicited much interest and the Electricity Control Board received a number of complaints regarding the sufficiency of the information and compliance with the requirements in the Electricity Administrative Regulations. From discussions with Kudu Power it came to the fore that the applicant intends to request that certain information confidential information be exempted from the public requirement.”
Added Namene, “Currently the Electricity Control Board is awaiting an application for confidentiality exemption from Kudu Power [if any].”
On 6 August 2014, Kudu Power advertised its application for an electricity generation license in The Namibian, a daily. The construction of a power station 25 kilometres north of Oranjemund is being developed in partnership with majority shareholder NamPower (51%), CEC Africa (30%), and a strategic equity partner who will hold 19%. NamPower will be the main off-taker of energy generated at the 800 megawatt power facility with secondary off-takers in South Africa, and Zambia. In May, NamPower was negotiating the sale of 100 megawatts to South African power generation utility ESKOM. The hiccup according to NamPower relates to changes in legislation on the procurement of power from Independent Power Producers and imports from outside of South Africa.
Majority shareholder NamPower anticipates electricity to cost approximately US$0.11-0.12 per kilowatt hour, making it competitive in comparison to any new power project expected to come onto stream by 2017. Comparisons to prospective power projects in Zambia indicate the competitiveness of the Kudu project. A basic cost comparison shows that the 120 megawatt Itezhi-Tezhi hydroelectric project on Zambia’s Kafue River, the 300 megawatt Maamba coal fired power station and the 600 megawatt Kafue Gorge Lower hydro-electric power project will effect similar tariffs, with the Kafue tariff hitting US$0.14 per kilowatt hour.
Construction of the ambitious power project is scheduled to start in 2015 while commercial operations are scheduled to start in the first quarter of 2018.