Mozambique intends to gather $8.5 billion, mainly from foreign investors, under its 2009-2013 Energy Strategic Plan for hydropower production. The plan will incorporate old and new energy generation projects and would allow Mozambique to export more electricity. The country has potential to generate 14,000 megawatt (MW) of hydropower, but produces only 2,075 MW of electricity, mainly at its Cahora Bassa Hydroelectric (HCB) plant in Tete province.

Energy Minister Salvador Namburete said On Tuesday the government approved an $8.5 billion, 2009 to 2013 Energy Strategic Plan whose main objective is to at least increase power generation between 3,000 megawatts to 3,400 megawatts to the existing output, and attract foreign investments.

We want to attract energy intensive projects which would contribute to the rapid development of the country, Namburete said.

Namburete said that the major share of the money will be sourced from foreign investors and could be secured despite the current credit crisis.

The money will come from government initiative, that is from state budget, but we are banking much on private investors, mainly foreigners, Namburete said. The bigger part of investments will come from private foreign companies.

Namburete said that the country wanted to increase its potential to supply energy to the southern African region, where major projects including mines have been shelved due to power shortages.

Given the energy shortages in the region, and our need to accelerate rural electrification, we view this strategy as our launch board to meet the demands, Namburete said.

Mozambique has several energy generation projects in the pipeline, including the second phase of the HCB scheme.

HCB has suffered from decades of neglect and lack of investment. It provides 60% of its power to Eskom Holdings Limited. It also supplies 35% of its electricity to Zesa. Mozambique consumes only 5% of the power produced.