Sierra Leone needs $3.5bn investment to restore power sector
According to Deputy Energy Minister Martin Bash-Kamara on Saturday, Sierra Leone is seeking $3.5-billion of investment from the private sector to overhaul its creaking electricity industry with the aim of increasing output 10-fold by 2017.
Sierra Leone, struggling to recover from an 11-year civil war that ended in 2002, has one of Africa's lowest power generation capacities, at just 100 megawatts for its 5.6-million people.
President Ernest Bai Koroma's government has signed several memorandums of understanding with investors to develop power projects in the mineral-rich West African country, Kone said.
"$3.5-billion is the projected cost of achieving the minimum 1 000 megawatts," Bash-Kamara said in an interview. "This is what it's expected will come in foreign direct investment."
With state finances under strain, the government wants investors to cover the capital investment and then recoup their money by selling power to the national grid, Kone said.
The government has signed a memorandum with China's Hydrochina to build two hydroelectric power plants at a total cost of more than $800-million. The plants at Bekongkor and Mange would produce a total of 260 megawatts.
Mujimoto Sierra Leone, in partnership with state-owned China National Electric Engineering Company (CNEEC) and renewables company New Generation Energy, plans to develop solar-thermal facilities with a capacity of up to 500 megawatts, Kone said.
Germany's privately owned BC Bangert is eying solar plants with an output of 100 megawatts.
Jindal Steel and Power, India's second biggest steelmaker, has signed a memorandum to build a 350 megawatt coal-powered plant in the northern Port Loko district.
Jindal has been considering an iron ore investment in Sierra Leone.
The coastal capital Freetown mostly relies on the 50 megawatt hydroelectric dam at Bumbuna in central Sierra Leone. This is running at just 40% capacity having been plagued by technical problems since its long-delayed launch in 2009.
The government has signed a deal with renewable energy company Joule Africa to expand the Bumbuna site, raising maximum output to 250 megawatts at a cost of up to $800-million. Construction is due to begin in 2014.
"We have huge hydro potential in the country. It ranges from 1 200 megawatts to 5 000 megawatts depending on who's counting," the minister said.
Problems with transmission network
Sierra Leone is losing between 30 and 38% of the power it produces due to problems with the transmission network, the minister said. In a bid to renew the ageing grid, the government will offer private investors the chance to operate the network, outside Freetown.
Bash-Kamara said it was hoped the increase in power would make Sierra Leone a more attractive investment destination and facilitate government plans to develop manufacturing.
Sierra Leone hopes to become a power exporter once the West African Power Pool transmission line comes online in 2017. – Reuters