Cost of Zambia hydro project soars

LUSAKA, Zambia 9/10/09 (PennWell) — The cost of expanding and upgrading the Kafue Gorge hydropower project on Zambia’s Kafue River will be well above initial estimates, according to Zesco, Zambia’s state-owned electric utility.

Cyprian Chitundu, Zesco’s managing director, said the project will cost between US$1.5 billion and US$1.8 billion, substantially higher than the initial estimate of US$1 billion. Zesco attributed the increased cost to higher prices for copper, iron ore and other key construction materials.

The project calls for the construction of a 750-MW power station at Kafue Gorge and the upgrade of six existing generators at that plant. The utility said it will issue US$120 million in bonds in 2010 to help fund the expansion.

The added generation is needed to meet the country’s growing demand for energy. Power consumption in Zambia has risen 70 percent in five years, Zesco said.

Zesco recently completed the rehabilitation and uprating of the existing Kafue Gorge project. (HydroWorld 3/26/09) The plant boosted capacity by 90 MW to 990 MW. The uprating and rehabilitation cost the Zambia government US$49 million.


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