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MBABANE – The Eswatini Electricity Company (EEC) has renewed a E150 million Power Purchase Agreement (PPA) with Ubombo Sugar Limited (USL) initiated in 2011 until 2026.
The co-generation relationship between the two companies has seen USL being one of the few local Independent Power Producers (IPPs) contributing approximately 80 GWh of electricity annually to the local grid. Last Friday, the two companies signed a fourth addendum to the existing PPAagreement in a ceremony held at the EEC Head Office, Eluvatsini House.
Relationship
“We are proud to be one of the first large IPP in the country and playing a role in adding value to the socio-dynamics of the Eswatini economy. Our relationship with EEC is well managed and good for the energy security of the kingdom,” USL Managing Director Muzi Siyaya said. He mentioned that USL had a serious intent to invest about E1 billion to increasing the USL factory and cogeneration capacity.
“Working closely with our development partners (EEC, Eswatini Sugar Association, European Union, ESWADE and government) and to increase land area under cane, a need existed to extend the beneficiation of the sugar value chain to the surrounding Big Bend and Siphofaneni communities. This still remains a key facet of our ESG agenda as a business today,” Siyaya said.
He mentioned that these developments presented an opportunity to use the by product cane (bagasse) as fuel (which also includes woodchip) to sustainably generate electricity for their own use and to export same into the national grid. EEC Managing Director Ernest Mkhonta appreciated the milestones achieved between EEC and USL over the years in the PPA. He highlighted that the existence of USL in the co-generation space meant EEC reduces its import quota for local supply.
Importing
“We are no longer importing 80 per cent from our major supplier Eskom, but we are also getting power from other countries and also internally through local generation and the involvement of IPPs such as USL,” Mkhonta said.
He challenged and appreciated
USL for their plans to increase their capacity, which will increase supply to the local grid. Mkhonta said this will go a long way in reducing EEC’s dependency on imports.
USL annually provides around 90 per cent of its own energy requirements from installed electricity generating capacity using renewable resources, such as bagasse which is the fibrous residue that remains after the extraction of juice from the crushed stalks of sugar cane.
The electricity is used primarily within the sugar manufacturing process to power milling, refining, and packaging processes and where possible, to provide electricity for the irrigation of agricultural estates, other business requirements, and for use within residential villages.