Work started in January on the development of the project on the Zambezi river, construction of which is intended to start in 2009 for commissioning in 2013.

The 1500MW scheme is being developed by a joint venture of Electricidade de Mocambique (EDM), Camargo Correa and local firm Energia Capital.

Mphanda Nkuwa is estimated to cost US$1.6B to build, and separately the 1400km long transmission line is budgeted at US$2.3B. The scheme is to be privately financed without recourse to government funding.

Energy Minister, Salvador Namburete, said the proposal would be evaluated and submitted to the Cabinet for approval. He added that the government wished to see project development get underway as the scheme is one of a number of priority energy project it wishes to see built to boost the economy.

The project has been criticised by environmental groups over the numbers of people in the Zambezi valley that would directly benefit from the hydro power scheme. But the government recently told the UN Office for the Coordination of Humanitarian Affairs’ review service (IRIN) that the scheme would boost the country’s economy with extra jobs and sources of revenue to aid the balance of payments and, therefore, broadly assist poverty reduction.