1. Outlook Of Mozambique Power Sector Nordic Business Breakfast
10th December 2014

2. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

3. MOZAMBIQUE Population: 23.760 mil GDP (Nominal): USD 15.355 billion
Per capita: USD 630
GDP Growth Rate : 7.5% (2013)
Exchange Rate USD/MT: 30.50

4. MACRO-ECONOMIC INDICATORS
INTERNATIONAL CONTEXT
2010
2011
2012
2013
World Economy GDP growth Rate (%)
5.3
3.8
3.3
3.0
Euro Zone
1.9
2.0
-0.7
-0.4
Asia (China e Índia)
9.5
7.8
6.7
6.5
Sub-Saharan Africa
5.7
5.2
4.5
5.1
Mozambique
7.1
7.3
7.5
World Inflation Rate (%)
3.7
4.8
4.0
1.6
2.7
2.5
1.5
9.3
9.0
6.9
12.7
10.4
2.1
4.2

5. 10 MAIN FDI SOURCES IN 2013

6. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

7. Energy Outlook for Mozambique Electricity Supply Industry
Electricidade de Moçambique (EDM): The national power utility wholly owned by the state responsible for the generation, transmission, distribution and commercialization of electricity throughout the country.
Hidroeléctrica de Cahora Bassa (HCB): Owned by Moçambique Government (92,5%) and REN / Portugal (7,5%) is the Independent Power Producer (IPP) responsible for the generation of electricity in Cahora Bassa (2075 MW)
Mozambique Transmission Company (MOTRACO): Independent Transmission Company (ITC), Owned 33.3% by EDM, 33.3% ESKOM and 33.3% SEB with the responsibility to supply electricity to MOZAL and wheel power to EDM and SEB of Swaziland

8. Outlook Of Mozambique Power Sector electrification and coverage
1977
2004
2006
2007
15 Districts Electrified
15 Districts Electrified
2008
2009
2010
2014
121 Districts Electrified

9. Outlook Of Mozambique Power Sector Access to electricity – on grid

10. Outlook Of Mozambique Power Sector Customer base and new connection
Moçambique is after South Africa the highest new connection rate per Year in SADC with an average of new connection in the last 3 years

11. Outlook Of Mozambique Power Sector Transmission National Grid Expansion
Past
Present
Future
1977
2014
All capital provinces connected to the national Grid
2020
Novas centrais e linhas de transporte para responder a demanda
Only 3 capital provinces connected to the national Grid

12. Outlook Of Mozambique Power Sector Historic power balance
Cahora Bassa contributes with 94% of the power balance

13. Outlook Of Mozambique Power Sector National demand

14. Outlook Of Mozambique Power Sector regional demand
Planned Capacity will exceed peak demand by 2016.

15. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

16. Outlook Of Mozambique Power Sector EDM Organisation

17. Outlook Of Mozambique Power Sector The new paradigms….
Before
Present & Future
Ensure medium and long term energy needs and access to natural resources
Competitiveness of the energy sector in the Country
Promote private initiative
Operational management efficiency
Extend the access to electricity to the population
Promote “cheap energy” for economic development
Institutional development and regulation of the electricty sector
Government and Regulator
Finance de development of the electricity system in the Country
Funding predominant under Concessional Scheme
Regulated tariff system
Economic and Financial viability on the investment (PPP)
Cost reflective Tariff and or Cost recovery mechanism
Governance, transparency,
Donnors and Financiers
Access to basic energy services and low tariffs
Surplus capacity of infrastructure in transmission
Excess of energia
Availability / Service / Quality of Supply / Industrialization
Transmission Capacity on the Limit / constrains
Déficit of power and new generation plants
Clients / market

18. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

19. The Mozambique natural resources and the least cost options
Mozambique Natural Resources: Hydro

20. Outlook Of Mozambique Power Sector Hydro natural resources
Mozambique is the second country in Southern Africa with the biggest hydro potential
The potential in Zambezi river is beyond MW and only 2075 MW is in operation at Cahora Bassa South Bank
The total unexplored hydro potential in Mozambique is close to MW out of which in Tete province

21. Outlook Of Mozambique Power Sector Coal natural resources
Mozambique Coal reserves are believed to be amongst the world’s largest , and a strong investment currently being made in the sector, particular in the Tete Province
Moatize Coal basin poised to become the World’s newest major export coal basin
2 large scale projects already in mining activity (20 to 50 Mtpa)
Additional large scale coal projects in exploration (Ncondezi, Jindal, Rio Tinto, Zambeze, Revuboe, etc..)
Potential + 50 Mtpa of export coal by 2025
The coal proven reserves can produce more than MW, base load power for 30 years

22. Outlook Of Mozambique Power Sector gás natural resources
The only gas fields currently in production in the country are located in Temane, in Inhambane province
The gas is exported and transported by pipeline to South Africa by SASOL, a South Africa Company
27 MGJ are allocated for power generation
> 100 MGJ is for export to South Africa
Currently, EDM, SASOL, Investec, Aggreko, Gigawatt and MGC are developing generation power projects
Around 350 MW will be Installed until in Ressano Garcia (Border with South Africa)

23. Outlook Of Mozambique Power Sector Gás natural resources
2011 and the first months of 2012 saw the announcement of successive large finds of natural gas in Mozambique offshore.
Such potential of natural gas identified is corresponding to 150 to 200 trillion cubit feet.
The size of the natural gas finds in the Rovuma basin could turn Mozambique into Africa’s second large exporter of natural gas in 2019/20
Medium and large scale power generation plant could be installed in the north of Mozambique (> 2000 MW)
Possibility of large scale development of a liquefied natural gas (LNG) project

24. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

25. Outlook Of Mozambique Power Sector regulatory framework
EDM created in 1977 with monopoly for GX, TX & DX (except for HCB)
Law for Public Enterprise approved in 1991 (Lei Nº. 17/91)
EDM transformed into a Public Enterprise in 1995
Electricity Act approved in 1997 (Lei Nº. 21/97)
Electricity Regulation Decree approved in 2000 (Decreto 08/2000)
Tariff System Decree 29/2003
EDM designated Manager of the National Transmission Grid and System Operator in 2005 (43/2005)
Private Partnership Law for Infrastructure (Decree nº 15/2011)

26. Outlook Of Mozambique Power Sector comparative advantages
Natural Resources
Proven Gas reserves
Proven Coal Reserves
Proven firm Hydro Renewable Reserves
Financing
Corporate balance
Possible to refinance after COD
Hydro Base
No FSA
Long Term PPA
Thermo Base (Coal)
Coal as a waste product from mining

27. Generation Expansion Plan 2012 - 2020 Cahora Bassa Norte (1245MW)
Ncondezi
(300 MW)
Benga
(300 MW)
Palma (ENI)
(75 MW)
Cahora Bassa Norte (1245MW)
Lúrio
(120 MW)
Alto-Malema
(60 MW)
Mphanda Nkuwa
(1500 MW)
Boroma
(200 MW)
Moatize
(300 MW)
Mavuzi 2 & 3
(60 MW)
Lupata
(600 MW)
Massingir
(25 MW)
Temane
(400 MW)
Kuvaninga
(40 MW)
Gigawatt
(100 MW)
CTRG
(175 MW)
> 2020
ELECTROTEC
(30 MW)
Aggreko
(222 MW)
CTM
(100 MW)

28. Power Balance and energy Mix

29. Power Balance and energy Mix (Short and Medium term)

30. Power Balance and energy Mix
(Medium and long term)

31. Power Balance and energy Mix
(Medium and long term)
Until 2020 Gás will contribute with 42% of energy

32. Road map of EDM equity financial participation

33. Project development tracking matrix

34. Table of Content Macro economic indicators Electricity Sector Industry
Present and future challenges
Natural Energy Resources
Generation Expansion Plan
Conclusion

35. Outlook Of Mozambique Power Sector conclusions
The Electricity Sector will required more than 3 bUSD in the next 5 years to sustain energy demands
Concessional, Commercial and Private equity funding will be required
GoM will play a determinant role to Develop the ESI, including but not limited to project promotion
There is in place adequate regulatory framework and conducive for Independent Power Producers of electricity (IPPs)
Gás will be a Game changer on ESI and determinant for Gás to Power initiatives
EDM is going to a process of complex initiatives that needs special kills, competence and good Governance
Cost reflective tariffs will be fundamental to sustain the Investment required

36. Thank You