Electricity capacity expansion plan for Lesotho – implications on energy policy

Abstract

This study aims to produce a research-based integrated electricity expansion plan for Lesotho that focuses on the security of supply at national level. The Autoregressive Integrated Moving Average (ARIMA) is used to model electrical demand and the PLEXOS modelling tool is used to analyse the cost of investing and producing future electricity for the country. The results underscore the need for investment geared towards local generation particularly in large hydro up to 0.22 GW, PV up to and 1.1 GW and pumped storage up to 0.5 GW by 2050, to keep up with future demand and reduce the cost of imported electricity in the country. Succinctly, the investigation reveals, inter-alia, that: 1) Lesotho's energy demand will continue to increase over the modelled period (up to 2050), with the gap between the local generation and demand concomitantly increasing; 2) large hydro generation, if harnessed will guarantee long-term energy security and cheaper energy relative to both imports and small hydro; 3) any shift in the energy policies of external suppliers at current tariff structures, will increase Lesotho's energy costs significantly, thus, negatively impacting on the country's economy; and 4) investing in local energy generation will guarantee long-term national energy security and affordability.