Zambia's major mines turn to South African power amid energy crisis

Bloomberg reported on Friday that Zambia’s largest mines are seeking power from an unexpected source as the country grapples with an unprecedented energy crisis.

The mining sector is turning to South Africa’s Eskom Holdings for electricity due to severe power shortages in Zambia.

Zambia, which relied on hydropower for about 85 percent of its electricity, is facing a severe energy deficit caused by an historic drought that had significantly reduced water levels at Kariba Dam, the world’s largest man-made reservoir.

The situation had left households with power for only three hours a day and forced companies like First Quantum Minerals to seek power outside Zambia’s borders to maintain operations at their mines and smelters.

The situation had worsened beyond earlier predictions, with Kariba Dam nearing a complete shutdown for the first time.

Maintenance issues at the Maamba coal-fired plant have further exacerbated the power crisis.

Anthony Mukutuma, a director at First Quantum’s Zambian unit, noted that the power imports from Eskom, which were not anticipated, are helping to alleviate the impact of the reduced local power supply.

Eskom’s transmission unit had been supplying 250 megawatts to Zambia since August, which is more than 10 percent of the country’s normal national demand.

Plans are in place to double this amount within a month through a deal facilitated by the regional electricity-trading company Africa GreenCo.

This shift is facilitated by new government regulations allowing open access to power transmission lines, enabling entities like Africa GreenCo to provide energy solutions outside the previously state-dominated grid managed by ZESCO.

First Quantum, which produces about half of Zambia’s copper and operates Africa’s largest nickel mine, and other mining companies, which account for around half of Zambia’s power demand, are now sourcing more expensive regional power to compensate for the shortfall.

ZESCO had imposed emergency restrictions, limiting mining operations to 40 percent of their usual power supply.

The government is striving to protect the mining sector, which contributes approximately 70 percent of Zambia’s export earnings.

Normal power generation capacity stands at about 3,777 megawatts, but current production was only 1,019 megawatts.

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