Unless Botswana adds at least 500 megawatts in the next two decades to its committed, dispatchable electricity generating capacity, the country will not be able to catch up with demand and cause massive energy deficit.
The situation will mean that the country will for the long-term continue to rely heavily on imported energy, mainly from South Africa which is also deemed unsustainable.
An energy market study report for the Southern Africa region prepared by Tlou Energy, points out that the supply-demand balance will tighten in the next coming years across the region, in consistence with historically cyclical nature of power market supply-demand.
This therefore means that Botswana will need to add at least 500 MW to its supply grid by 2040 so as to keep up with the growing demand, the report suggests.
A couple of energy companies have lined up a number of projects to address the energy supply in Botswana and across the region. However these projects are yet to reach the operational stage, meaning that they will have to be fast-tracked to address the deficit that is projected in the coming years.
The demand-supply balance is expected to tighten even if projects in the pipeline are delivered. Figures shown in the report indicate that historically power supply in Botswana has been a challenge and the key power supplier, coal-fired Morupule B situated near Palapye, is reported to have produced around 300 MW for most of 2016 while average demand for Botswana was 400-500 MW daily for the same period.
This left the country heavily relying on imports from South African power utility company, Eskom which is also battling to address demand in its native country, according to media reports.
The situation is likely to remain the same for the foreseeable future unless all the options available are explored to contain the circumstances. This is because the region will need around P80 billion in new generation capacity by 2030 to keep pace with demand and it is unclear where this amount will come from.
Botswana alone will need at least P1.8 billion to address its electricity shortages problems.
The energy deficit situation is expected be worsened by historic trends which indicate that new power generation projects in the region have not been rolled out in a timely manner and many are currently stalled and it is feared they may never proceed.
The report suggests that Botswana has options to contribute to its own self-sufficiency and exports into the region using quick start gas generation. Tlou Energy is also looking into addressing this challenge through the use of new technologies.
The Gas-to-Power developer, which listed on the Botswana Stock Exchange (BSE) in 2017 through its Lesedi Project, wants to tap into this niche and ultimately sell power through an agreed Power Purchase Agreement or on the regional spot market.
Another challenge that is contributing to the current situation is said to be lower tariffs which remain heavily subsidized across the region. It is believed that lower tariffs are unsustainable and confers severe financial losses on regional power utilities, and is also a disincentive to new investment.
Former minister of energy, Kitso Mokaila has previously announced that Botswana was looking to become a major exporter of power by 2018. He said the country will also tap into renewables in order to position itself as a net exporter of electricity.