The World Bank has approved $420 million in grants to strengthen Mozambique’s energy transmission system. The grants will be issued through private sector investments to modernise the country’s energy transmission capacity for domestic and regional markets. The grants will also be used to help expand the country’s generation capacity. The project will also be co-funded by a $24 million grant from a Norwegian Trust Fund.
Mozambique will use the grants to finance its Temane Regional Electricity Project (TREP), which includes construction of a 563 km high-voltage line between Maputo and Vilanculos/Temane.
A $750 million 400 MW combined cycle gas-fired power plant will also be constructed at Temane.
Zayra Romo, the project’s senior energy specialist and task team leader, said: “In addition to enhancing the transmission and generation capacities, the TREP will finance technical studies in support of regional power integration and renewable technologies in power system planning and operation. It will also support studies on power sector investment plans, including Mozambique’s role in regional trading.”
Deborah Wetzel, Director for Regional Integration for Africa, the Middle East, and Northern Africa for the World Bank, said: “The Temane project is key to increasing opportunities for power trade among SAPP countries. Despite the abundance of energy resources in the subregion, lack of cross-border interconnections remains a major constraint. The full integration of SAPP countries’ power systems and more power trade could bring savings of $42 billion in investment and operating costs till 2040. The Bank is committed to helping southern Africa realise these potential savings.”