Ministry of Economic Development has contracted China's Dongfang Electric Corporation to develop a 20-megawatt power project in Addu City.
At a function held at Maagiri Hotel, the contract was signed by Director at economic ministry Nahiya Mohamed and Chief Representative of Dongfang Kui Chun.
The ministry said the project that costs USD 37.5 million will be self-funded by Dongfang. As per the Public Finance Act, the project has been awarded to Dongfang without tender process after fulfilling cabinet approval and permission from relevant authorities.
The administration has also decided to award the project as Addu City is a key area in the Blue Economy policy of the administration. Addu Power Project is deemed essential to developing economic activities in the city. Dongfang was also considered capable of carrying the project as it is financially strong and technically experienced.
Speaking at the event, Minister of Economic Development Fayyaz Ismail said the administration intends to provide a permanent solution to the provision of electricity in Maldives during the 5-year term of the administration. The minister further said the development of proper and reliable basic services such as sewerage systems, power and clean water is essential in the efforts to develop 4 economic hubs across Maldives as per the electoral pledge of the administration. He said the administration intends to develop the power generation capacity that serves the needs for the next 15 years.
Addu Power Project will be run in collaboration with state utility company Fenaka Corporation Limited. The project to be completed in 15 months would be managed and operated by Fenaka once the project is completed.
Managing Director of Fenaka Ahmed Saeed foresees a contemporary power house built in Addu at the end of the project. He suggested the project would bring revolutionary changes to the power system in Addu, which is the first major development initiative to improve the power system of the city after 23 years. He further said Addu City would have the capacity to develop 36 megawatts of electricity at the end of the project.
As part of the efforts of the administration to move towards green energy, it has been targeted to produce 70% of the power produced in Addu via renewable energy sources. The project will see the development of a 10-megawatt solar energy system as part of the renewable energy project.
Meanwhile, Mayor of Addu City Council Abdulla Sadiq said the power grid in the second largest city of the country is very old and providing electricity to the residents is currently very costly. The mayor said the residents hope the power project would solve the power uncertainties and failures in the city. He also said power is one factor that hinders economic development in the city and the council expects the project to bring positive changes to economic activates in the city.
Addu City can currently produce only 6 or 7 megawatts of electricity from outdated generators, although over the years it has installed generators to produce 25 megawatts of electricity.