THE Zimbabwe Power Company will pay 39 percent less of what they were paying the Bulawayo City Council for treated potable water for the reclaimed water it will draw from Khami Dam that will be used for power generation at the Bulawayo Power Station.
At the moment, ZPC is buying treated potable water to the power station at $1,04 per kilolitre. However, once the re-furbished Bulawayo Power Station is complete, it would not use treated potable water for power generation purposes but raw water that will be drawn from Khami Dam. The two parties have now agreed that ZPC will pay $0,63 per kilolitre for the Khami water.
According to the contract, the project to rehabilitate the power station will entail the rehabilitation of the Khami Pumping Station and the Water Treatment Plant both owned by the City of Bulawayo as well as the construction of a raw water pipeline from Khami Dam to the Bulawayo Power Station. ZPC will undertake all these projects and will recover its money through deductions on the monthly water bill.
“ZPC shall seek funding to undertake the refurbishment of the Khami Water Treatment Plant and construction of the 20-kilometre pipeline from Khami Water Treatment Plant to Bulawayo Power Station for and on behalf of BCC, in order that it satisfies the water requirements of Bulawayo Power Station.
“ZPC shall recover the cost of refurbishment of Khami Water Treatment Plant and construction of the 20km pipeline from Khami Water Treatment Plant to Bulawayo Power Station, through deductions on the monthly water bill. The water tariff of $0,63 per kilolitre shall be negotiated and reviewed on completion of the Khami Water Treatment Plant and pipeline project; when the actual project costs and actual interest on the project funding will be known,” reads part of the agreement.
In total, the local authority will be supplying 11 megalitres of water to the power utility with an additional four megalitres going to other customers.
“The parties hereby agree that the primary purpose for the refurbishment of the Khami Water Treatment Plant and construction of pipeline is to supply adequate water to ZPC’s Bulawayo Power Station and have agreed that the requirement shall be 11 megalitres per day. BCC has requested that an additional four megalitres of water be supplied for its other customers from Khami Water Treatment Plant.
“All the direct and indirect costs for supplying additional water to other BCC customers that are beyond the resizing of the pumps and the costs associated with ZPC requirements shall be borne by BCC. For avoidance of doubt, ZPC shall only provide a single Tee-Off point on the main line but shall not meet the cost of the line to BCC’s other customers,” reads the agreement.
The agreement shall continue for a period of 25 years. The project is expected to boost generation at the Bulawayo Power Station by an additional 90 megawatts, which would be fed onto the national grid to boost power supply to the country.
An $87 million India-EximBank line of credit was approved in 2015 during President Mugabe’s visit to that country for the refurbishment of the power station. About $30 million of the $87 million has since been extended towards the rehabilitation project. The facility has a tenure of 13 years, a grace period of three years and a repayment period of 10 years at two percent interest rate per annum.
Bulawayo Power Station was built in 1957 with an installed capacity of 120 MW. The power station has been facing a number of problems and according to ZPC nothing was being generated for the greater part of last week.