Could you introduce Tembo Power’s involvement in DRC and the strategy for its hydroelectric power projects?

Between the members of FEC, we used to have a weekly conference call, and one of the recurring issues was the lack of energy in DRC; we therefore decided to address it. We teamed up with Tembo Power and did it in a very pragmatic way with the help of their engineers; first mapping out the lack of energy and viable hydropower sites nearby, we later met the Ministry of Energy and went through the portfolio of SNEL to see how we could help them.

We started in Haut-Katanga Province but hydropower potential was limited. Then, we looked at Lualaba province and identified several opportunities on the Kalule River. We are now implementing the development work on this portfolio whose installed capacity is around 70MW, using reputable and experienced legal, technical and environmental & social advisors. The next steps are to carry out geotechnical studies to fine tune detailed designs and finalize financial structuring with the aim of reaching financial closing by June 2019. Mining companies have expressed interest to purchase our electricity, as well as power trading companies.

What regional projects is Tembo working on outside of DRC?

Tembo Power is also developing a small hydropower portfolio of more than 80MW in Western Kenya, with a first tranche of 15MW closing by the end of this year, as well as two hydropower schemes in Burundi for a total expected capacity of 20MW. The mining energy deficit is over 1,200MW based on current needs, and we are confident that we can develop, finance and construct small hydropower schemes allowing the mining sector to purchase power from us at competitive levels.

Tembo also looks at geothermal and natural gas. What potential do you think such sources, along with solar, have in DRC?

We are not strong advocates of solar, being an erratic source of power unable to meet customer’s demand on an utility scale basis, even if capacity factors have improved with the use of batteries for storage. We allow ourselves to consider solar only when it can be efficiently combined with hydropower and supply electricity during dry seasons, and are still assessing the merits of such a solution in DRC.

To what extent is the deficit in power holding back mining production in DRC, and why is there not more investment in power projects?

Current power supply is not always reliable for several reasons and is not sufficient. The addition of power generation capacity in DRC is challenging because of the Governments’ budgetary constraints, the lack of transmission infrastructures, the accessibility of viable sites, and the difficulty to finance projects, whether on a corporate or project finance basis. Power demand is closely related to the mining sector and the reason for lack of investment is the volatility in the commodity prices. During the downturn, caused by a fall in demand from China, people were more pessimistic about the soundness of our initiative, but today opinions are much more favorable.

What technical challenges do you typically face in power projects in DRC?

On a technical basis, feasibility studies were challenging due to accessibility, but also given the unavailability of hydrological data (this required the installation of various meteorological and gauging instruments last year). Operating of such power plants is also more complex in DRC, where we have to provide a solution for the transmission infrastructure as well.

Generally speaking, technical challenges are less of a hurdle than legal and financing ones, and DRC is no exception to that fact. We are working hard to structure a package that would be fully compliant with local law, given that private investments in the energy sector are still new in DRC, like in many neighbouring countries.

Could you share with us Tembo Power’s vision for the future? 

Tembo Power’s vision is to supply stable, reliable and affordable electricity to Sub-Saharan Africa and address its huge power needs, with a specific focus on baseload technologies and power trading. Our projects are so far located exclusively in rural areas - as viable hydropower is generally associated with hilly places – making this activity a perfect tool to deploy international financial support, and have a meaningful and positive impact on communities.