Millennium Challenge Account-Malawi (MCA-M) has said the ongoing power sector reforms, particularly the unbundling of the Electricity Supply Corporation of Malawi (Escom) into two will help address constraints in the energy sector.
Energy Generation Company (Egenco) and Escom residual, will start work in January 2017.
Speaking on Friday in Mangochi during a sensitisation workshop organised by the Association of Business Journalists (ABJ), MCA-Malawi deputy chief executive officer Lameck Mithi said the power sector reforms will improve Escom turnaround activity and regulatory strengthening activity, which will help to revitalise the sector.
He said the unbundling of Escom will enable other players such as Independent Power Producers (IPPs) to participate in terms of investing in the energy sector, ultimately increasing electricity generation.
Said Mithi: “In the first phase, we are looking at generation side. It is our hope that once Escom has completed the unbundling, there will be other investors from the private sector who will be looking at generation as an opportunity to invest their resources in.
“Once that takes place, we will increase the capacity for generation, which will also increase the number of people using electricity in the country.”
In terms of implementing the power market restructuring, Mithi said MCA-M has so far achieved a number of milestones key among them is to have a model, which Malawi will be using and has already been completed.
“We were supposed to develop a road map which we did some time back last year. From that time to date, we have been implementing the programme,” he said.
Mithi said another critical issue on the activity was amendment of legal frameworks such as the Electricity Act and what remains is the allocation staff to the two companies by December 31 2016.
ABJ national coordinator Aubrey Mchulu hailed MCA-M for sponsoring the workshop, which he said will go a long in equipping journalists with information on power sector reforms.
The power sector reforms project is a component of the $350.7 million (K242 billion) under the five-year Millennium Challenge Corporation (MCC) energy compact that seeks to improve generation and distribution infrastructure.
In an earlier interview, Minister of Natural Resources, Energy and Mining Bright Msaka was upbeat that the over 30 companies, which expressed interest to join the power generation industry will bring a boost to the energy sector after the unbundling of Escom.
Meanwhile, MCA-M is also rehabilitating Nkula A hydropower plant, which was commissioned in 1966.n