Reflection of luxury profits from Energy Reversal to RSA and garbage charges by EDM in Mozambique

Paulo Vilanculo "

On 21 May, the Cahora Bassa Hydroelectric Power Plant (HCB) will hold an international conference in Maputo to mark its fiftieth anniversary. Under the motto “HCB: Yesterday, Today and the Future”, the event promises to reflect on the path, challenges and aspirations of one of the largest energy production infrastructures in Southern Africa. Five decades after its construction, and more than 15 years since Mozambique acquired the majority of its capital from Portuguese management, the silence surrounding HCB’s real contribution to the country’s development is deafening. However, amidst the celebratory speeches and flashes of institutional prestige, a fundamental gap remains: the absence of an honest and rigorous public assessment of HCB’s contribution to the Mozambican State Budget, as well as to improving the quality of life of its citizens. Why, at an event of such magnitude, is the opportunity not taken to transparently disclose the real figures for energy production, revenue generated and the share that actually goes to public coffers? Why is the direct impact of HCB on the financing of social sectors such as education, health, water supply or rural infrastructure not presented in accessible language? What has been the direct return of HCB on local development in Tete, the province that is home to the dam and whose populations continue to face high rates of poverty, unemployment and low inclusion in the benefits of the megaproject? HCB is often treated as a symbol of national sovereignty and colonial overcoming.With the understanding agreement signed between the Mozambican president, Armando Guebuza, and the Portuguese prime minister, José Sócrates, Mozambique became the majority shareholder in the dam's shareholding structure, holding 85% of the hydroelectric plant's capital, with Portugal holding the remaining 15%.nSpeaking after the signing ceremony, Mozambican President Armando Guebuza said the agreement had "established guidelines for Cahora Bassa to soon be managed by Mozambique." In turn, Portuguese Prime Minister José Sócrates expressed his satisfaction considering the "historic agreement for Portugal and Mozambique, for having been able to conclude a negotiation that had dragged on since 1975." In Mpauto, Mozambican Prime Minister Luisa Diogo told the BBC that the Cahora Bassa Hydroelectric Dam reversion agreement would allow the country to take control of its development agenda. Following the reversion of control to the Mozambican state in 2007, much of the power generated was channelled to the South African state-owned utility Eskom, at fixed prices that were highly favourable to RSA. Over the years, this reversion has become a geostrategic asset for South Africa, at the expense of Mozambican domestic development. The power generated at Cahora Bassa is transported by a high-voltage transmission line (HVDC) to RSA, with minimal losses and with technical priority, in contrast to the power distribution infrastructure within Mozambique, especially in rural areas, which is considerably precarious. There have been reports over the years that Mozambique sells electricity to RSA at prices below those charged on the international market, hampering HCB’s ability to maximise profits. The disparity between the real value of the power and the amount paid by Eskom represents a substantial economic gain for South Africa and a strategic loss for Mozambique. Contracts with Eskom have remained firm, with clauses often unfavorable to Mozambique in terms of price per megawatt hour and contractual rigidity. Thus, so far, HCB continues to guarantee cheap and stable energy for South Africa, even as Mozambique faces internal supply deficits. The Mozambican energy model, focused on the export of raw energy (without added value), perpetuates a model of economic dependence and undermines the possibility of internal industrialization. While the RSA transforms energy into industrial and social development, Mozambique continues to act as a supplier of raw materials with electricity. Without a profound review of the energy sales model, distribution priorities and international contracts, Mozambique will continue to be an exporter of wealth and an importer of poverty. It is imperative that the Mozambican government and the management of HCB promote a transparent and patriotic renegotiation of energy agreements, put the national interest first and ensure that energy from Cahora Bassa serves, above all, to illuminate and develop Mozambique. In the Industrial development of RSA and underdevelopment of Mozambique, theHCB’s energy has been powering South Africa’s heavy industry, especially mining and processing, for decades, boosting jobs, production and sustainable economic growth in the neighboring country. According to data from recent years, less than 40% of the Mozambican population has regular access to electricity, while in South Africa this rate exceeds 90%. A cruel irony: the energy-producing country remains in the dark, while its neighbors light up factories, schools, hospitals and shopping centers with energy exported from Cahora Bassa. Meanwhile, the Mozambican regions closest to the dam, such as Tete and Zambeze, continue to have high rates of poverty and unemployment, without directly benefiting from the benefits of the energy generated there. It is essential to remember that energy is not just megawatts, dams and high-voltage lines. Energy is human development, it is social justice, it is sovereignty shared with the people. In this sense, the celebration of HCB's 50th anniversary without clear, accessible and honest communication to the Mozambican people about its true contribution to the country sounds like an empty institutional spectacle, devoid of open management of civic sensitivity. On the other hand, in Mozambique, where less than 40% of the population has regular access to electricity, the imposition of garbage fees on EDM bills is one of the most flagrant manifestations of fiscal injustice and poor administrative governance. By including garbage fees in electricity bills, the State, through EDM, has found an easy way to ensure automatic and compulsory collection. This is an opportunistic expedient that transfers the burden of the State's inefficiency onto the shoulders of a minority of citizens who already pay dearly for an essential service. The stark truth is that, in many cities and towns, garbage continues to accumulate on street corners, in markets, on beaches and even on people's doorsteps. Collection is irregular, final disposal is unhealthy, and environmental management policies are practically non-existent. The charge is undifferentiated, that is, it does not take into account whether the citizen actually receives the garbage collection service or whether he or she is managing the waste by his or her own means, as is the case of many residents in peripheral neighborhoods and areas without municipal coverage. However, those who are paying for this service are only those Mozambicans who have formal access to electricity and who have the capacity to pay regularly. In other words, those who are already overburdened with other fees and taxes, often without any visible return in public services. However, the luxury of HCB's non-executive directors is more than an administrative detail; it is a symptom of a deeply unequal system, where public resources are captured by a minority to maintain a lifestyle disconnected from the national reality. It is a perversion of the public function, which transforms the State into a provider of privileges for a political and business elite. The celebration of HCB's 50th anniversary should be, above all, a moment of accountability, an exercise in transparency in which the government and the company's managers open the books, explain the investments made, the accumulated profits, any debts inherited and, above all, the destination of the revenues. If HCB really wants to project a sustainable future, it must begin by acknowledging the past with humility, showing the present with transparency and building the future with social responsibility, not only in international conferences, sports marathons, awarding literary competitions and equipping its administrators in the eyes of the poor Mozambicans. And this will only end when the Mozambican people themselves stop being mere spectators and become the true overseers and beneficiaries of what is rightfully theirs.

2025/12/3