For butcher Velson Phiri, right, and his assistant, left, lack of reliable electricity affects their bottom line.
I am proud to have been a part of the MCC story that is changing the landscape of Malawi’s power sector. Earlier this week, we celebrated the closure of MCC’s five-year $350 million compact with the Government of Malawi, which focused on improving the availability, reliability and quality of the power supply, expanding access to power, reducing the cost of doing business, and revitalizing the way the country produces and delivers power.
As part of the compact, a new high-voltage (400 kilovolt) electricity transmission line and associated substations were constructed. The 173 kilometer line and substations will provide a modern electricity backbone to Malawi’s power grid and serve as a ‘super electricity highway,’ transmitting power more efficiently and reliably throughout Malawi from the south where the power is generated from hydropower plants, reducing technical losses and allowing for future connection via Mozambique to the Southern African Power Pool that operates at the 400 kilovolt level. Once connected, Malawi will no longer be an electricity island in southern Africa.
Infrastructure was just one aspect of the compact, however. The large-scale infrastructure investments of the compact were complemented by a comprehensive Power Sector Reform Project. The project worked to strengthen pivotal institutions and enhance the regulation and governance of the power sector by providing technical assistance and a leading-edge enterprise management systems to the Electricity Supply Corporation of Malawi (ESCOM) to improve financial and operations management. MCC investments also supported the development of a new regulatory environment that would lay the foundation for greater private sector participation in the power sector that would boost new generation capacity and expand access.
Breaking the Cycle in Malawi
Environmental management was also a critical component of MCC’s systemic approach to strengthening and sustaining Malawi’s power sector. Inadequate access to power created a vicious cycle in Malawi along the Shire River Basin that supplies water to the hydropower plants. The market for wood charcoal does not just threaten the environmental health of the country, it also disrupts hydropower generation, which produces over 90 percent of Malawi’s power.