Botswana generates more of its own electricity – Stats Brief
• Electricity generated locally contributed 52.6 percent to electricity distributed during the fourth quarter of 2020
Over the years, Botswana has shifted from a country that was highly dependent on South Africa for electricity to one that produces most of its electricity. The main aim of the country is to be self-sufficient in its energy requirements, allowing it to export to its neighbours.
According to the Stats Brief, Fourth Quarter of 2020, Morupule A and B power stations remain the major producers of electricity in Botswana, accounting for 94.1 percent of electricity generated. The remaining 5.9 percent was contributed by emergency power plants dotted across the country.
Botswana’s electricity sector is dependent on large scale thermal coal power plants utilizing coal from domestic reserves that are estimated at 200 billion tonnes. However, demand for electricity often exceeds supply, resulting in load shedding, use of back-up diesel power plants, and electricity imports through the Southern African Power Pool (SAPP).
Botswana’s largest share of distributed electricity is used in the mining sector, which consumes close to 35 percent, followed by the commercial users at 30 percent while the residential sector users take about 26 percent, states the publication Stats Brief. Government use accounts for the remaining 9 percent.
An analysis of the quarter-on-quarter comparison shows that the contribution of electricity generated to electricity distributed decreased by 8.2 percentage points compared to the 60.9 percent during the third quarter of 2020. However, the latest Electricity Generation report produced by Statistics Botswana shows that electricity generated locally contributed 52.6 percent to electricity distributed during the fourth quarter of 2020, compared to a contribution of 51.2 percent during the same quarter in 2019. This gives an increase of 1.5 percentage point improvement of locally produced electricity this year.
A closer look at the physical volumes reveals that the physical volume of imported electricity decreased by 12.3 percent (65,335 MWH) from 531,036 MWH during the fourth quarter of the previous year. This has mainly been as a result of improving local production compounded by a reduction in total demand of electricity for the period.
Compared to the previous quarter, imported electricity increased by 19.7 percent (76,796 MWH), from 388,905 MWH to 465,701 MWH in the current quarter. Botswana imported 47.4 percent of total electricity distributed during the fourth quarter of 2020. South Africa’s Eskom was the main source of imported electricity at 59.1 percent of total electricity imports. Nampower of Namibia accounted for 19.2 percent, while the remaining 16.9 and 4.8 percent was sourced from the Southern African Power Pool (SAPP) and cross-border electricity markets respectively. Cross-border electricity markets are an arrangement whereby towns and villages along the border are supplied with electricity directly from the neighbouring countries such as Namibia and Zambia.
The physical volume of electricity generated also took a dip of 7.0 percent (38,949 MWH), from 556,576 MWH during the fourth quarter of 2019 to 517,627 MWH during the current quarter. The quarter-on-quarter perspective shows that local electricity generation decreased by 14.4 percent (87,020 MWH), from 604,647 MWH during the third quarter of 2020 to 517,627 MWH during the period under review. Reduction in generation could be attributed to a number of technical faults that occurred on the Morupule plants.
According to a recent Reuters article, Botswana Power Corporation (BPC) has been operating at significant losses for years due to high import costs, non-performing assets and operational inefficiencies, making it heavily reliant on government subsidies to stay afloat. In a bid to ensure tariffs are cost reflective, affordable and appropriately priced, the country has recently witnessed increases in electricity tariffs. However, “the rate remains one of the lowest in countries in the region without hydropower,” the Reuters article reads.
Although increasing tariffs has put pressure on households and businesses already under strain from the coronavirus outbreak, BERA says the rise was necessary to enable BPC to cover its operational expenses (Reuters). Reports state that the country is in the process of adding renewable energy and natural gas power generation to its portfolio through independent power producer (IPP) projects towards remedying the situation.
*This article was prepared by Data Collection & Analysis, a business research firm. Feedback or enquiries can be relayed to 76740658.