Anindita Chatterjee
Updated on: October 10, 2024 11:00 pm GMT
Zambia’s copper mines are facing severe operational challenges amid the country’s worst energy crisis, forcing them to turn to an unexpected power source: South Africa’s Eskom Holdings SOC Ltd. This development comes as Zambia grapples with unprecedented power shortages, primarily driven by extreme drought conditions affecting Lake Kariba, the world’s largest man-made reservoir, significantly impacting hydropower generation.
Zambia’s Energy Crisis Deepens
The energy crisis in Zambia has escalated, with households now limited to just three hours of electricity per day. The country relies heavily on hydropower for around 85% of its electricity, but prolonged drought has led to a critical depletion of water reserves at Lake Kariba. The situation has become urgent, with projections indicating that power generation at the dam could cease within weeks if water levels continue to drop.
This crisis has prompted companies such as First Quantum Minerals Ltd. to seek alternative power sources to sustain mining operations, which are vital to the nation’s economy. The mining sector typically accounts for about 50% of Zambia’s total power consumption and is crucial for the country’s export earnings, generating approximately 70% of these revenues.
Power Imports from Eskom
As part of efforts to mitigate these energy supply shortages, Eskom, which itself is recovering from past difficulties in meeting its own country’s electricity demands, has begun supplying power to Zambia. Since August, Eskom’s transmission unit has provided 250 megawatts of electricity, representing more than 10% of Zambia’s usual energy requirements.
Anthony Mukutuma, a director at First Quantum’s Zambia operations, confirmed that the power imports from Eskom were not previously anticipated, but they have helped alleviate some of the adverse effects caused by the crisis. “As such, we expect power supply to First Quantum Minerals operations to continue uninterrupted,” he stated.
Plans for Increased Supply
In a bid to further address the energy shortfall, plans to double the power supply from Eskom are underway. This effort is being coordinated by Africa GreenCo, a regional electricity trading company, which is facilitating arrangements to ensure that more electricity can be transmitted to Zambia in the coming weeks.
Ana Hajduka, CEO of Africa GreenCo, noted the importance of these developments in addressing the ongoing energy challenges in Zambia. The potential increase in power supply will be critical for sustaining mining operations that have been adversely affected by the state utility Zesco’s emergency restrictions, which have cut normal electricity supplies to the mining sector by 40%.
Impact on the Mining Sector
First Quantum Minerals operates Africa’s largest nickel mine and is a significant player in Zambia’s copper production, contributing about half of the country’s output. The company, along with other mining operators, is increasingly reliant on electricity to maintain production levels amidst the current crisis. The usual generation capacity of Zambia, which stands at 3,777 megawatts, has plummeted to a mere 1,019 megawatts, underscoring the severity of the situation.
- Electricity Shortages: Households restricted to three hours of electricity daily.
- Hydropower Dependence: 85% of Zambia’s energy comes from hydropower, now severely affected.
- Mining Sector Vulnerability: Mining operations account for around 50% of the country’s electricity demand.
Efforts by the Zambian Government
The Zambian government has made concerted efforts to shield the mining sector from the impact of these supply cuts, recognizing its critical role in the economy. However, the ongoing maintenance at Zambia’s only coal-fired power plant has further strained the already precarious energy landscape.
Despite these challenges, the mining sector’s dependence on imported power highlights the lengths to which operators must go to maintain production. The reliance on costlier regional power sources illustrates the urgent need for a sustainable energy solution in the wake of the ongoing crisis.
Looking Ahead
As Zambia navigates through this period of energy uncertainty, the reliance on Eskom for electricity provides a temporary solution to the immediate challenges. However, industry experts emphasize the need for long-term strategies to diversify Zambia’s energy sources and reduce dependence on hydropower.
The developments surrounding the power crisis not only affect the mining industry but also raise broader concerns about energy security in Zambia. As the country works to implement solutions, the outcomes will be closely monitored by industry stakeholders and policymakers alike, who understand the significant implications that energy availability has on economic stability and growth.
Zambia needs to bring in more power, and that’s really important. But as things change, it’s also key to plan carefully and invest in strong energy systems. This will help Zambia be ready for any future problems with energy.
