Morupule B power station
| Part of the Global Coal Plant Tracker, a Global Energy Monitor project. |
| Related coal trackers: |
Morupule B power station is an operating power station of at least 600-megawatts (MW) in Palapye, Central, Botswana with multiple units, some of which are not currently operating. It is also known as Morupule C (Units 5-8).
Location
Table 1: Project-level location details
| Plant name | Location | Coordinates (WGS 84) |
|---|---|---|
| Morupule B power station | Palapye, Central, Botswana | -22.522329, 27.048833 (exact) |
The map below shows the exact location of the power station.
Unit-level coordinates (WGS 84):
- Unit 1, Unit 2, Unit 3, Unit 4, Unit 5, Unit 6, Unit 7, Unit 8: -22.522329, 27.048833
Project Details
Table 2: Unit-level details
| Unit name | Status | Fuel(s) | Capacity (MW) | Technology | Start year |
|---|---|---|---|---|---|
| Unit 1 | operating | coal: bituminous | 150 | subcritical | 2013 |
| Unit 2 | operating | coal: bituminous | 150 | subcritical | 2013 |
| Unit 3 | operating | coal: bituminous | 150 | subcritical | 2014 |
| Unit 4 | operating | coal: bituminous | 150 | subcritical | 2014 |
| Unit 5 | cancelled | coal: bituminous | 150 | subcritical | – |
| Unit 6 | cancelled | coal: bituminous | 150 | subcritical | – |
| Unit 7 | cancelled | coal: bituminous | 150 | subcritical | – |
| Unit 8 | cancelled | coal: bituminous | 150 | subcritical | – |
Table 3: Unit-level ownership and operator details
| Unit name | Owner | Parent |
|---|---|---|
| Unit 1 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 2 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 3 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 4 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 5 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 6 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 7 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
| Unit 8 | Botswana Power Corp [100%] | Botswana Power Corp [100.0%] |
Project-level coal details
- Coal source(s): Morupule coalfield
Units 1-4
Morupule B power station is a 600 MW expansion of Botswana Power Corporation's (BPC) sole existing power station, the Morupule A Power Station.
Background
BPC had been considering an expansion of the Morupule Power Station since 2006. One option was a 400 megawatt expansion with another option being a 1,200 megawatt expansion. The bigger expansion option would involve the sale of surplus electricity into South Africa and possibly other neighboring countries.[1]
BPC eventually decided on 600 MW, consisting of four 150 MW units. According to BPC, the impetus for the project was the country's reliance on importing approximately 80% of its power from the South African utility, Eskom. In response to electricity shortages in South Africa, Eskom decided that it would cease power exports to Botswana by 2012.[2]
The project was expected to be completed by October 2012, but by the end of 2013, only two units were in operation. BPC said the delay was due to mismanagement by the plant contractor China National Electric Equipment Corporation (CNEEC).[3] The other two units were completed in 2014, but three of the four units had broken down by October 2014, and Botswana was considering importing more energy from Eskom in South Africa until the units were repaired.[4]
Two units were running in June 2015, and the government was reportedly considering shutting the power station down.[5] By 2015, the project had cost Botswana tax payers an estimated 11 billion pula – making it the most expensive project ever undertaken in the country.[6]
In June 2016, Botswana Energy Minister Kitso Mokaila said there were plans to refurbish Units 1-4 and negotiations to sell it and have it operate as an IPP.[7]
In December 2016, it was reported that Units 1-4 of "troubled" Morupule B power station, although rated at 600 MW, were only operating at 21 percent capacity and producing 130 MW of power.[8]
In 2017, China Machinery Engineering Corporation (CMEC) submitted an offer to buy the 600MW Morupule B power station from the Botswana Power Corporation (BPC). BPC said it was evaluating the offer but declined to indicate how much it was. The negotiating process was expected to be done before end-2017. If successful, the handover of the plant would be done around February or March 2018. CMEC is the sister company to the Chinese firm that built the plant in 2012, China National Electric Equipment Corporation (CNEEC).[9]
In June 2018, Botswana scrapped the talks to sell the plant to CMEC,[10] reportedly because the offer made by CMEC fell short of what the Botswana government felt Morupule B was worth, given the initial capital expenditure and subsequent expenses. There was also disagreement over terms for remedial work on the plant, which would involve taking each of its four units down for a year, completely overhauling that unit, then putting it back online. CNEEC was bearing the costs under a contractual clause in the original agreement, and CMEC wanted to be able to use Chinese equipment for the remediation, but Botswana officials refused, given the experience with Morupule B.[11]
In November 2018, the Minister of Mineral Resources, Green Technology and Energy Security Eric Molale said only one unit was working at the Morupule B Power plant, contradicting statements by the Chief Executive Officer of Botswana Power Corporation (BPC) Dr Stefan Schwarzfischer, who said two units at Morupule B Power station were operational, while unit 4 was undergoing remediation and unit 3 was out of service.[12]
According to BPC's 2019 Annual Report, BPC signed a Defects Remediation Agreement with contractor China National Electric Equipment Company (CNEEC) to remedy the plant's defects. The agreement would result in the remediation of all the plant’s defects in a phased manner commencing in 2019 through to January 2023, covering each unit per year.[13]
The failure of critical equipment at Morupule B in August 2020 led to a power generation loss of 200 MW and the plant being reduced to 31% of its capacity.[14] Botswana media reported in September 2020 that the plant "continues to experience perennial plant reliability challenges due to equipment and construction defects", with repair work on of the units delayed due to Chinese engineers being prevented from traveling to the plant because of COVID-19 restrictions.[15]
In February 2021, BPC’s Board Chairman announced that remedial work on Unit 4, which started in June 2019, was nearing completion and that the unit was expected to be fully functional by April. At the time, the boiler re-construction work was complete and awaiting commissioning. In addition, the Chairman reiterated the remaining three units were forecast to be refurbished and up-and-running by 2023.[16]
Though the plant was operating as of May 2022, refurbishment and operational challenges remained ongoing.[17] BPC's general manager for generation reported that another one of the 150MW units should be coming back online between July and September 2022. BPC said that Morupule B was running at 63% capacity and was continuing to seek alternatives to meet Botswana's national demand.[18] Noting the ongoing remedial efforts being funneled into the plant, the Sunday Standard wrote: "The troubled plant has been fraught with problems since inception despite the fact that it was supposed to be an answer to Botswana’s chronic power shortages."[19]
In August 2022, the power station was reportedly stable and operating at full capacity. This brought Botswana's coal-powered energy generation to over 800 MW between Morupule A and Morupule B, which was a significant excess to the country's needs. BPC therefore had the ability to export energy to neighboring South Africa.[20] President Cyril Ramaphosa of South Africa said in a press conference that state utility Eskom would create a power purchase agreement with BPC, but no contracts were yet signed.[21]
September 2022 reporting stated that following successful remedial work on Unit 4, a similar procedure was slated for the other units; the plant was expected to be fully refurbished by January 2025.[22]
On May 8, 2023, both Morupule B power station and Morupule A Power Station had reportedly experienced outages that day due to a "grid disturbance", causing a countrywide blackout. The BPC had implemented rotational load shedding as the stations were reportedly being restarted.[23][24] Unit 2 of Morupule B had reportedly been undergoing refurbishment at the time of the outage.[25] Later in May 2023, BPC's CEO said in a press briefing that the power station would be fully operational in 2026.[26]
In March 2024, Botswana's Minister of Minerals and Energy said that remedial works on the power station would be complete by mid-2027.[27] Later in the month, the Botswana Power Corporation (BPC) reportedly requested P1.722 billion (US$127 million) in funding to pay overdue balances to suppliers and purchase spare parts for Morupule B. Following this request for additional funding, a Member of Parliament called for an investigation into BPC's operations and finances, saying that "all is not well at BPC" and that remedial work on Morupule B was taking "too long."[28]
Financing for units 1-4
In October 2009, the World Bank’s Board of Executive Directors approved a US$136.4 million loan for the the Morupule B project and also approved a Partial Credit Guarantee of US$242.7 million of commercial bank financing for the project. In a media release, the World Bank stated that "the financing will help secure a reliable electricity supply for the country’s economic growth and poverty reduction programs. Financing will also help Botswana prepare a robust low-carbon growth strategy (consistent with the current Tenth National Development Plan: 2009-2016), strengthen management skills in the power sector, and establish a new, independent electricity regulator."[2]
The World Bank stated that the funding was for "the construction of the 600 megawatt Morupule ‘B’ coal-fired power station, accompanied by related transmission lines and a water supply system. Moreover, the project will support the country’s evolving low-carbon growth strategy, including fast-track exploration of alternatives such as coal-bed methane (CBM), concentrated solar power (CSP), and new, emerging technologies such as carbon capture and storage. In addition, the financing will provide for the establishment of an independent energy regulator, and also help to improve project implementation capacity at Botswana Power Corporation and the Botswana Ministry of Minerals, Energy, and Water Resources."[2]
The World Bank's Vice President for the Africa Region, Obiageli Ezekwesili claimed that support for the project "will help to not only increase generation capacity and access but also serve as a down payment for a greener future."[2]
Insurance from the China Export & Credit Insurance Corporation covers 95 percent of the scheduled and unpaid principal and interest amount during the first fifteen years of the WB loan.[29]
In November 2009, a financing agreement for units 1-4 was closed. The Industrial and Commercial Bank of China and Standard Bank agreed to provide the project with US$965 million in loans. Botswana Power Corporation agreed to provide the project with US$635 million in equity. SBI Capital Markets, Bank Muscat, and Project Financing Solutions acted as financial advisers to the sponsor. Delphos International acted as financial adviser to the government.[30]
Controversies
During the bidding process for construction of the power station, there were allegations that the Chinese contractor chosen (CNEEC) was awarded the tender through questionable means, as it was said to be pre-qualified without the necessary expertise. The Chinese Ambassador to Botswana, Ding Xiaowen, had advised Ministers Ponatshego Kedikilwe and Mompati Merafhe that the Chinese state owned company was not certified to undertake a project of that magnitude.[31]
During construction, the Ministry of Minerals, Energy and Water Resources (MMWER) temporarily shut the power station down due to environmental issues. The contractors are alleged to have been pumping raw sewage to water their gardens, with the residual water contaminated with sulphuric acid flowing into the village's river networks. There are also reports that at least two Chinese workers died during construction, and some Botswana workers were injured at the power plant as a result of lax observation of safety principles. In June 2015 media reports revealed that one of the boilers at the Morupule B Power Station had melted down when it was being tested.[31]
After a 2015 investigation into problems at the plant, CNEEC contracting manager Jianio Caiyi and two other company project supervisors allegedly fled the country, leaving the Station Project Manager, Glenn Black, who later handed in his resignation.[31]
Units 5-6
Background
The 2 x 150 MW project was put out for tender in 2014. It was initially referred to as Morupule C, but was later reported as expansion of Morupule B.[32] The project would be set up by an Independent Power Producer that would enter into a Power Purchase Agreement with the Botswana Power Corporation outlining tariff charges. The project was planned along with a new open-cast mine at the Morupule coalfield.[33]
In March 2016, it was reported that Japanese company Marubeni had formed a joint venture with South Korean firm Posco Energy, which together had been named as the preferred bidder for the 300 MW expansion of the Morupule B Power Station. This would be the first Independent Power Producer (IPP) operated plant in Botswana.[34] The two firms said they would jointly design, finance and construct two 150 MW circulating fluidised bed coal-fired units and then operate and maintain the plant for 30 years. Construction was expected to start late 2016, with the first electricity into the national grid by May 2020. The joint venture contracted South Korean GS Engineering & Construction Corp to execute the project.[35]
In December 2016, the Botswana Ministry of Environment, Wildlife and Tourism of Botswana issued an environmental permit for the plant, and concluded the Purchase Power Agreement (PPA) with Marubeni. Construction was planned to begin in January 2017.[36]
However, in April 2017, it was reported that BPC was considering renegotiating or even terminating its Power Purchase Agreement (PPA) with Marubeni. Under the PPA, BCP had to buy all of the generated electricity, regardless of the amount used, leading to concerns by BCP that it would have to pay for excess electricity and risk default. In June 2017, BPC submitted a petition to the President of Botswana to reconsider the PPA. It was unclear when or if construction would begin.[36]
In January 2018, it was reported the expansion had been put on hold due to a disagreement over terms. Botswana Energy Security Minister Sadique Kebonang said the government failed to agree with Marubeni and Posco Energy on a number of issues, notably a proposed US$800 million state-backed guarantee to protect the companies’ investments. According to Kebonang: "The Power Purchase Agreement has now expired since the project failed to take off within a year from the date of signing as stipulated in the agreement.”[37]
In November 2018, it was reported that the "government is reportedly reluctant to take on any more commitments for electricity" as the country already had "the 600MW Morupule B, the refurbished 120MW Morupule A, a 100MW solar plant in the works and a 160MW in installed diesel plants".[38]
On October 4, 2019, Marubeni said it had pulled out of the proposed extension. Marubeni released a coal policy in September 2018 pledging to reduce its coal-fired power investments and avoid any new coal-fired power projects “as a general principle.”[39]
As of December 2023, there were no known developments on Units 5 and 6 and the expansion appeared to be cancelled.
Financing for units 5-6
Of the US$800 million (P8.7 billion) tender for the expansion, US$600 million was set to be financed by the Export-Import Bank of Korea, the Japan Bank for International Cooperation (JBIC), and an international commerce bank through project financing. Marubeni and POSCO would recover their costs by selling power to the BPC through a 30-year Power Purchase Agreement (PPA). Nippon Export and Investment Insurance (NEXI) would cover the private banks’ insurance.[35]
In May 2019, the Japan Bank for International Cooperation (JBIC) and Japan's Nippon Export and Investment Insurance (NEXI) announced that they stopped their official consideration to finance and insure the Morupule B coal-fired power plant project in Botswana.[40]
Units 7-8
In April 2016, the Botswana Public Procurement and Asset Disposal Board (PPADB) announced it had approved a request by the Ministry of Minerals, Energy and Water Resources to use the direct appointment method to engage a joint venture between two South Korean firms, KEPCO and Daewoo, to construct Units 7 and 8 at Morupule B. According to the notice, the IPP contractors would be required to design, finance, construct, own, operate, maintain and decommission at the end of the economic life a 300 MW brownfield coal-fired power plant comprising two 150 MW units. The tender had not yet been awarded.[41] It is planned for completion in 2020.[42]
In October 2016, African Energy issued a statement objecting to the awarding of the project to KEPCO and Daewoo at the expense of local companies, stating that the Korean companies had no previous track record in Botswana.[43]
With no known developments on the units since 2016, plans appeared to be cancelled.
Articles and Resources
References
- ↑ "Morupule to feed power-hungry Botswana," Business Report (South Africa), July 13, 2006
- ↑ 2.0 2.1 2.2 2.3 World Bank, "World Bank Financing for Continued Growth, Enhanced Poverty Reduction in Botswana Board of Directors approves US$136.4 million for critical electricity supply project," Media Release, October 29, 2009
- ↑ "Gov’t turns against Morupule B contractor," Sunday Standard Reporter, December 1, 2014
- ↑ "Total blackout at Morupule B," Mmegi Online, October 15, 2014
- ↑ "Morupule B might shut down," Business Weekly, June 3, 2015
- ↑ "Morupule B project uncertainty persists," Weekend Post, February 2, 2015
- ↑ "Morupule B capacity to be doubled," Mmegi, June 15, 2016
- ↑ "Another 300 MW extension for Morupule B," Mmegionline, December 16, 2016
- ↑ "Chinese firm tables offer for Morupule B," Mmegi, November 3, 2017
- ↑ "Botswana cancels plans to sell troubled power plant to Chinese firm," Reuters, June 12, 2018
- ↑ "Revealed: Why Morupule B deal failed," Mmegi Online, August 24, 2018
- ↑ "BPC turns profitable," The Patriot, November 28, 2018
- ↑ "Annual Report," BPC, 2019
- ↑ "Botswana risks power shortages as Morupule B breaks-down again," Sunday Standard, August 24, 2020
- ↑ "Morupule B still fails to power Batswana," Sunday Standard, September 11, 2020
- ↑ "Morupule B Powering Up," Kabelo Adamson, The Voice, February 16, 2021
- ↑ "Electricity Generation: One Step Forward, Two Steps Backward," Weekend Post, May 10, 2022
- ↑ "BPC to replace diesel with LNG at Orapa plant," Mmegi Online, May 20, 2022
- ↑ "BPC, signs Power-Purchasing-Agreements with Akuo Energy," Sunday Standard, March 23, 2022
- ↑ "China-built power plant transforms Botswana into electricity exporter," Xinhua Net News, August 27, 2022
- ↑ "Light At The End Of The Tunnel," The Voice, August 2, 2022
- ↑ "Morupule B shines after 10-year storm," Mmegi, September 16, 2022
- ↑ "Botswana hit by blackout earlier on Monday," news24, May 8, 2023
- ↑ "Eskom helped ‘kick-start’ Botswana after nationwide electricity blackout," Sowetan Live, May 9, 2023
- ↑ "BPC sees power cuts easing by Thursday," Mmegi Online, May 9, 2023
- ↑ "‘Troubled Morupule B will only be fully operational in 2026’," Weekend Post, May 19, 2023
- ↑ "Remedial works on Morupule B to complete by 2027," Botswana Guardian, March 8, 2024
- ↑ "MP calls for investigation of BPC," The Voice Botswana, March 27, 2024
- ↑ "IBRD Partial Credit Guarantee (PCG) to advance Botswana power sector development," Financial Solutions, March 2010
- ↑ "Preview of Morupule B Coal Plant Expansion | Transaction | IJGlobal". ijglobal.com. Retrieved 2020-10-02.
- ↑ 31.0 31.1 31.2 "Morupule B environmental disaster," Mmegi, July 30, 2015
- ↑ "Domestic Coal Project," Shumba Coal, accessed July 2015
- ↑ "Plans underway to refurbish Morupule A," Botswana Daily News, October 2, 2014
- ↑ "Botswana to attain self-sufficiency in power generation by 2019," Mining Weekly, March 29, 2016
- ↑ 35.0 35.1 "PPADB approves P8bn Morupule B expansion tender," Mmegi, March 9, 2016
- ↑ 36.0 36.1 "1 Fact Sheet: Morupule B Coal-fired Power Station Project (Units 5&6)," Japan Center for a Sustainable Environment and Society (JACSES), October 20, 2017
- ↑ "Botswana power plant expansion plan stalls over terms," Reuters, January 29, 2018
- ↑ "Gov’t could drop Morupule B P8bn expansion," Mmegi Online, November 23, 2018
- ↑ "IEEFA update: Marubeni pulls out of Botswana coal power project," IEEFA, October 4, 2019
- ↑ "JBIC and NEXI stopped considering to support the Morupule B project in Botswana," No Coal Japan, May 27, 2019
- ↑ "Another 300MW extension for Morupule B," Mmegi, April 22, 2016
- ↑ "Morupule B capacity to be doubled," Mmegi, June 15, 2016
- ↑ "Investors bemoan govt's decision on Morupule B tender," DS ter Haar Advisory, October 15, 2016
Additional data
To access additional data, including an interactive map of coal-fired power stations, a downloadable dataset, and summary data, please visit the Global Coal Plant Tracker on the Global Energy Monitor website.
