Geita Gold Mine Transforms Energy Strategy with New Substation, Facing Grid Challenges

By Adonis Byemelwa

Recently Geita Gold Mine (GGM) has embarked on a transformative journey by shifting from costly fuel-based power to grid electricity. The launch of a new 34 MW substation, inaugurated by Deputy Prime Minister and Minister of Energy, Dr. Doto Biteko, signifies a monumental change for the mine, which previously faced exorbitant energy expenses.

GGM had been grappling with substantial operational costs, totaling Sh130 billion monthly. A significant portion of this, Sh 13.4 billion, was spent on fuel for power generation. The new substation, built for USD 24 million by GGML, is expected to slash the mine’s energy expenditures by a remarkable 92 percent. This substantial reduction in costs is anticipated to boost reinvestment in the mine’s operations and drive economic benefits for the local community.

“This transition to grid electricity is a major milestone for GGM. The savings on energy costs will allow us to reinvest in our operations and improve local economic conditions,” said Simon Shayo, Vice President of AngloGold Ashanti-Tanzania for Sustainable Projects. With the substation now operational, the mine’s reduced energy costs are expected to lead to enhanced employee benefits and increased community investments.

The inauguration of the substation highlights the productive partnership between Tanzania’s government and the private sector. Abubakari Issa, representing the Managing Director of Tanzania Electric Supply Company Limited (Tanesco), emphasized the government's investment of Sh 8.04 billion in constructing a 33 kV power line to support the substation. This investment is projected to generate an additional Sh 2 to 3 billion in monthly revenue for Tanesco, strengthening the national power supplier's financial position.

“This project not only boosts GGM’s operational efficiency but also enhances Tanesco’s revenue, benefiting the national economy,” Dr. Biteko stated during the inauguration. He lauded the initiative as a prime example of President Dr. Samia Suluhu Hassan’s commitment to fostering a business-friendly environment in Tanzania. “The collaboration between government and business illustrates how joint efforts can lead to significant economic advancements,” he added.

However, the transition to grid electricity brings with it a set of complex challenges. The integration of Geita’s mines into the national grid has put added pressure on Tanzania’s already strained power infrastructure. This situation underscores the broader difficulties of balancing industrial growth with reliable energy distribution.

In neighboring Shinyanga, which shares the same grid, residents frequently contend with dim lighting and power outages, particularly around the Williamson Diamond mine. The high energy demand from nearby factories exacerbates these issues, leading to frequent power disruptions. Similarly, Mbagala faces its own set of challenges, where the steel industry’s power consumption impacts businesses in areas such as Zakheim, Njia Panda Nzasa, Kingungi, and Chamazi. The strain from large-scale industries, while economically beneficial, places significant pressure on the local grid.

Despite Tanzania having over 2,300 megawatts of electricity available, especially following the inauguration of the Mwalimu Nyerere power plant, the grid struggles with distribution inefficiencies. The formula for electrical power, P = VI (where P represents power, V is voltage, and I is current), often reveals a mismatch between supply and demand. This mismatch can cause voltage drops and outages, highlighting systemic issues within the energy sector that need urgent reform.

To mitigate these challenges, the government must prioritize several key strategies. Upgrading grid infrastructure is crucial to managing increased demand and reducing the frequency of power outages. Implementing advanced load management systems and enhancing energy storage solutions can help stabilize the grid and ensure a reliable power supply.

 Additionally, decentralizing power generation and incorporating renewable energy sources, such as solar and wind, could alleviate pressure on the national grid and create a more resilient energy system.

Investing in local energy infrastructure is also essential to ensure that industrial growth does not compromise the quality of life for residents. Improved grid management practices, such as the use of smart grid technologies, can help balance the needs of industrial and residential users, ensuring equitable access to reliable power.

The successful transition of GGM to grid electricity is a pivotal step in advancing Tanzania’s energy sector. By addressing systemic challenges and investing in infrastructure, Tanzania can pave the way for sustainable industrial development that benefits both businesses and local communities.

 This approach will not only enhance the stability of the power supply but also support the country’s long-term economic growth objectives. The transition underscores the potential for strategic infrastructure investments to drive growth, and with the right measures, Tanzania can turn these challenges into opportunities for advancement.