Millennium Challenge Account-Malawi (MCA-M), the local implementing agency of Millennium Challenge Corporation (MCC) energy compact, has said, so far, it has disbursed about $203 million (about K113 billion) out of the $350 million (about K195 million) five-year grant.
The US energy grant is the largest single grant Malawi has received to revitalise the country’s energy sector through the rehabilitation of Nkula A, which was commissioned in 1966, and modernisation of power transmission lines to enhance capacity.
The compact agreement, which officially entered into force on September 20 2013, is set to meet gaps in Escom’s working and investment capital needs, among others, and is scheduled to be completed on September 19 2018.
MCA-M chief executive officer Susan Banda, said in an interview on Tuesday in Lilongwe, the awarding of a contract worth K4.2 billion ($7.5 million) to a French-based firm Alstom Grid brought total disbursements under the project to $203 million.
She said: “So far, with the signing of this particular contract [with Alstom Grid], we have committed $203 million, to be specific, of the $350 million resources which are available.”
Banda said MCA-M has enough time to implement all projects under the compact agreement, adding that out of the $257.1 million (K143 billion) set aside for infrastructure development project (IDP) activity, the institution has todate signed six contracts out of eight contracts worth $160 million (about K89 billion).
“We are still within the timeline of the implementation of our work plan in conjunction with our project partners such as Escom [Electricity Supply Corporation of Malawi], as well as consulting engineers. We believe we have enough time to implement the infrastructure development project,” she said.
Banda assured that come September 2018 when the compact agreement with the Malawi Government expires, MCA-M looks forward to having a more efficient Nkula A that is well rehabilitated and modernised with its capacity increased.
Currently, Nkula A has a production capacity of 24 megawatts (MW), but the production is projected to increase to 36MW after the completion of the project.
In an earlier interview, Escom system operations and power trading manager Patrick Kadewere said rehabilitation works at Nkula A, which will last for two years, will start in January 2016.
Escom marketing and business development manager Wiseman Kabwazi earlier said as an intervention measure, the power utility company will instal diesel-powered generators of 16MW, 10MW and six megawatts in Blantyre, Lilongwe and Mzuzu respectively. n