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ELECTRICITY EXPORTS COULD TRANSFORM ZAMBIAN ECONOMY

Zambia 2017 | ENERGY | VIP INTERVIEW

TBY talks to J. J. Sikazwe, Chairman/CEO of World Panel Zambia, on zero tax on renewable products, large-scale hydropower, and boosting investment in smaller energy projects.

What products does World Panel provide for the Zambian market?

In 2014, we launched our durable World Panel solar panels, devices that use renewable technology to charge mobile phones as quickly as an electrical outlet. The World Panel 500 combo-pack units with patented solar panel technology also come with a 5000-milliampere power bank and a 10-bulb LED light. The panels, once fully charged, have enough power to charge six regular cellphones or 20 hours of light using the LED lamp. They are waterproof and weatherproof and have a shelf life of between seven and 10 years. Furthermore, this is a mobile solar solution, that can be used by both urban and rural people to charge their phones, thereby saving on energy consumption and costs. Our intention, through this product, is to reduce energy poverty amongst the poor people of Africa. Since we launched three years ago, we have had great sales, especially from institutions from the likes of NGOs dealing with increasing quality of life in rural areas. From an individual perspective, a few people in rural areas can afford the product, and this has been one of our learning curves. While the product is designed for the rural community, socioeconomic conditions do not allow them to purchase it. We therefore entered into discussions about how to make this affordable, and concluded by negotiating with the policy of zero tax on renewable energy products with the government. Since then we have been able to bring prices down dramatically.

Is the product manufactured in Zambia?

We have not yet been able to produce the panels locally, although this is our eventual goal. Our panels were initially manufactured in China, even though the patent is from the US. Now, however, we have moved the product fabrication to a factory in the US. This product passes global standards. The original inventor of the product, professor John Anderson, did a great deal of research in African countries such as Uganda and Zambia, and was able to verify the quality and the efficacy of the product.

What is your view of the World Bank's Scaling Solar initiative, and its implications for Zambia's changing energy matrix?

For us as a country, it is a positive initiative. For many years Zambia has depended on hydropower, and while this has in the past proved to be an effective source for powering the nation, we have seen how recent weather patterns have negatively impacted energy generation. Because of this, it has become crucial to think outside the box and to diversify. Zambia has abundant sunshine and is an open country on a plateau. However, there is also the question of how to improve distribution channels of the captured energy from solar in order to make sure this energy reaches everyone who needs it. The majority of our population remains without access to energy. This has led to massive rural-urban migration, as people come to towns and cities in search of basic amenities they cannot access in more far-flung parts of the country. This, in turn, has resulted in congestion and overpopulation in Zambia's urban areas. To combat this, we should not just look at major projects, but also medium and small projects that can be set up in rural areas. With renewable energy, the initial cost appears high; however, in the long term it pays off. That is one of the things that the industry and the government needs to focus on.

Is the government right to invest in large-scale projects like the Kariba dam and Batoka gorge hydropower plants?

Given the scenario of the global economy, as well as the particulars affecting Zambia, it is important that we have a balanced strategy. In terms of the medium and long term, Zambia will always benefit from abundant water, regardless of whether this is sometimes unpredictable in the short term. If we can capture this and generate enough cheap power for export, then that will exponentially improve our economic scenario. Zambia is surrounded by eight countries, the majority of whom need energy. If we can produce cheap energy and are able to link up, then our export potential will be immense. Therefore these megaprojects will be vitally important for the economy at large.

What measures need to be introduced to boost investment, especially in smaller projects, in the country's energy sector?

First and foremost, the government must create an enabling environment for investment, which is what it is working toward. It has to reflect on the overall strategy and see where improvements can be made in policy and practicality to encourage other external parties to collaborate. Elsewhere, we need to revise our tariff structure. Energy tariffs in Zambia are some of the lowest in the region and have remained at the same level for many years now, though they are no longer reflective of the current landscape or the national energy strategy. New investors coming into the market will be understandably concerned about not recovering costs. Secondly, in terms of procurement, tendering, and registering projects, it is important to improve the timeframe in which we are able to turn around proposals. The world is competitive and if we lag behind, then it is likely that developers and investors will turn their attentions to another, more easily available opportunity in another market. The way to create business is to be more proactive, more engaging, and quicker in our turnaround. That way we will boost investor confidence in our competence and our efficiency. Finally, frequent changes to policy do nothing to help attract investment. This has been part of the problem in the past few years, with the government changing its stance to respond to the immediate needs of population segments without considering the long-term impact.


 

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