Mozambique Transmission Company - Motraco

Mozambique Transmission Company (Motraco) 

As Mozambique emerges as a prominent player in Southern Africa's energy landscape, the potential for hydroelectric, gas, and renewable energy generation is vast. A key player in this transformation is the Mozambique Transmission Company (Motraco), established in 1998. Motraco plays a crucial role in delivering reliable electricity to industrial clients like the Mozal Aluminium Smelter while facilitating regional energy integration.

Company Overview

Motraco operates as a joint venture equally owned by three national utilities:

Originally founded to address the power requirements of the Mozal Aluminium Smelter, Motraco has evolved into a central entity in regional power transmission. Its core mission is to provide efficient and reliable transmission services while ensuring acceptable returns for its shareholders. Headquartered in Maputo, Motraco operates under a concession model that exemplifies effective public-private cooperation in the energy sector.

Core Operations

Motraco's primary activities include:

Power Transmission

Motraco purchases electricity from Eskom in South Africa, mostly sourced from the Cahora Bassa Dam (with a capacity of 2,075 MW), and transmits it to:

Infrastructure Management

Motraco manages and maintains:

Service Outsourcing

Motraco effectively contracts maintenance and operational services, often utilizing shareholders or third-party providers to ensure high standards of service.

Motraco's reliable infrastructure supports 32.3% (2,680 km) of Mozambique's total transmission network, complementing EDM's 5,630 km.

Strategic Importance

Motraco serves as a linchpin in the energy ecosystem of Mozambique:

Industrial Enabler

By supplying power to Mozal, which consumes approximately 34–40% of the country's electricity production, Motraco supports the nation's largest industrial employer and 30% of its exports.

Regional Integration

As a member of the Southern African Power Pool (SAPP), Motraco facilitates cross-border power flows, enhancing energy security for Mozambique, South Africa, and Eswatini.

Economic Impact

Motraco's operations drive infrastructure development, job creation, and local procurement, significantly contributing to Mozambique's GDP and fostering industrial clustering within Beluluane Industrial Park.

Electrification Support

By facilitating power distribution to EDM, Motraco aids Mozambique's ambitious goal of achieving universal electrification by 2030, with access increasing from 34% in 2021 to 48% in 2022.

Recent Performance and Achievements

Motraco's operational excellence has recently been recognized:

Top Honors

Ranked first in turnover profitability and third in operational efficiency in the 2024 Mozambique Top 100 Companies list by KPMG Mozambique.

Financial Success

The company achieved net results of MZN 985 million (~$15.4 million USD), showcasing its strong financial health despite challenges posed by aging infrastructure.

Community Engagement

Investing in corporate social responsibility initiatives, Motraco funded a Home Economics Laboratory in Eswatini to enhance local education and community development.

Thought Leadership

Motraco's consistent ability to maintain reliable electricity supply to Mozal and other clients, despite managing infrastructure over 20 years old, highlights its technical expertise and strategic partnerships.

Business Opportunities

For energy sector leaders, Motraco offers various opportunities for collaboration:

Transmission Infrastructure

Partnering with Motraco provides an opportunity to maintain or upgrade its existing 400 kV lines and substations, particularly for technology providers offering smart grid or energy-efficient solutions.

Renewable Energy Integration

With Mozambique pursuing new generation projects, like the Mphanda Nkuwa Hydropower initiative (1,500 MW), Motraco seeks partners for wheeling renewable energy to regional markets via the SAPP.

Telecommunications

Motraco's surplus fibercapacity presents opportunities for telecommunications firms to enhance connectivity in Mozambique, Eswatini, and South Africa. Its partnership with TMcel indicates the potential for further collaborations.

Energy Exports

The infrastructure provided by Motraco is well-positioned to support Mozambique's ambition to become a regional electricity exporter, especially with upcoming projects like Mphanda Nkuwa. Investors in generation can collaborate with Motraco for transmission services.

Public-Private Partnerships (PPPs)

Engaging with EDM's $1.2 billion grid expansion and rural electrification plan (2020–2024) allows Motraco to facilitate PPPs that align with national development efforts.

Challenges to Consider

While Motraco offers immense potential, several challenges persist:

Aging Infrastructure

The operational life of Motraco's lines exceeding 20 years necessitates ongoing maintenance and upgrades, presenting both challenges and opportunities for technology providers.

Eskom Dependency

Motraco's reliance on Eskom's grid, which faced a 10% reduction in supply to Mozal in 2008, underscores the risks involved. A planned shift to EDM by 2026 aims to address this vulnerability.

Grid Capacity

The high consumption level of Mozal (~950 MW) places significant strain on Mozambique's grid, necessitating new generation projects to accommodate industrial growth.

Regulatory Environment

Navigating regional regulations while benefitting from tax incentives for projects like Motraco requires local expertise.

Future Outlook

Motraco is strategically positioned to support Mozambique's energy ambitions:

EDM Transition

By 2026, Motraco will transition Mozal's electricity supply to EDM, reducing its reliance on Eskom and enhancing sustainability through Cahora Bassa's hydroelectric resources.

Regional Exports

Motraco aims to facilitate power transmission from new projects like Mphanda Nkuwa to SAPP markets, taking advantage of Mozambique's vast 187 GW potential from hydro, gas, and renewable sources.

Innovation

Investments in digital telecommunications and energy efficiency initiatives will further solidify Motraco's standing as a regional leader.

Summary

Motraco serves as a vital link within Mozambique's energy sector, empowering industrial growth, fostering regional integration, and promoting electrification. Its robust infrastructure, impressive recent financial performance, and strategic vision make it an ideal partner for energy leaders. By collaborating with Motraco, stakeholders can unlock Mozambique's immense energy potential, contribute to sustainable development, and play a key role in shaping Southern Africa's energy future. For further details, visit www.motraco.co.mz or contact Motraco directly.