Mozambique extends Temane power plant concession by 30 years
By the AFREEQUE newsroom, based on Club of Mozambique
The Mozambican government has approved a rescue plan for the Temane thermal power plant in Inhambane province, with World Bank financing of up to $65 million for state electricity company EDM. The concession is extended to 30 years and fees reduced, according to Resolution No. 88/2026 of 4 November, which cites delays caused by Cyclone Freddy, Storm Filipo and the contractor’s abandonment of the construction site.
The Mozambican government plans to mobilise up to $65 million from the World Bank to finance state electricity company EDM’s participation in the Temane thermal power plant project in Inhambane province. The financing is part of the support package for the project’s recovery approved by the Council of Ministers, according to Resolution No. 88/2026 of 4 November reported by Club of Mozambique.
The plant’s concession period will be increased from 28 to 30 years, after six months were added to the initial 18-month extension granted for cases of force majeure. The project suffered delays linked notably to Cyclone Freddy, Tropical Storm Filipo and the abandonment of the construction site by the company responsible for the works, according to the government resolution.
The measure also provides for a reduction in concession fees, from 3% to 2% during debt repayment, then from 8% to 5% until the end of the concession. The government also authorises a temporary suspension of dividends owed to EDM, up to $39 million, as well as a waiver of claims for around $10.8 million in compensation related to the delays, according to the same text.
The Council of Ministers also authorised an 11.1% increase in the 'Capital Recovery Charge' component, intended to allow recovery of the project’s costs, according to the 4 November resolution.
