Thursday, June 20, 2024
BusinessPoor power supply hinders Mugher’s productivity

Poor power supply hinders Mugher’s productivity

Poor electric power supply is hindering the productivity of Mugher Cement, one of the biggest cement factories in the country, it was learnt.

Due to erratic electric power supply, the cement manufacturing plant often interrupts production and damages various machinery parts. Tebabal Wudineh, deputy director general Chemical Industry Corporation, the parent company of Mugher Cement, told The Reporter that poor electric power supply is severely costing the cement factory.

Tebabal said as the investment in the manufacturing sector is increasing and more factories with high electric demand are being built, the quality of power supply is decreasing. Cement manufacturing industry is a power intensive industry. Each cement factory needs 35-40 MW of electric power.   “There is an electric line connected to our transformer that supplies power to rural weredas and kebeles. When there is a technical problem on this line the problem would be reflected on our factory,” Tebabel said.

According to Tebabal, the erratic power supply has two negative effects on the cement manufacturing plant. “First, we interrupt production and we lose revenue. Second, there are some parts that are damaged by the poor electric supply and we spend foreign currency to replace these parts. The procurement procedure is also time taking.”

The other major problem the factory is facing in connection with power supply is inadequate power supply. Following the construction boom and the shortage of cement created in 2008, the state-owned company undertook a major expansion work at cost of 138 million dollars that boosted the production capacity of the factory by 150 percent to 2.2 million tons.

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The expansion project includes the construction of two production lines in Tatek Industry Area in Burayu town of the Oromia Regional State. Each production line has the capacity to produce 105 ton per hour. However, these new plants are using half of their production capacity due to inadequate power supply. “We have repeatedly held consultations with the Ethiopian Electric Utility but we were told to be patient until a new substation is built,” Tebabal said.

Andenet Degu, head of the Ethiopian Electric Utility Northern Addis Ababa district, told The Reporter that his company is separating Mugher electric line from the rural electrification lines. “Mugher Cement has its own transformer. There were some issues related to breakers and we are separating that. We have built separate breakers for the rural lines. We are also replacing the rural lines wooden poles with concrete poles.”

Regarding the electric supply problem at Tatek, Andnet said that there is a limitation at the substation. “A new substation was supposed to built when the expansion project was undertaken. But, due to the urgency, an electric line was installed for Mugher without a substation. So now we are building a new substation that will soon be commissioned. Once the new substation is finalized the plants will be connected to it and the problem will be resolved. It will be up and running soon. We are eagerly waiting for the completion of the substation. It is not only for the factory but the new substation will also benefit the community,” Andenet told The Reporter.

Mugher Cement Factory was founded by the former military regime in 1984 and built by an East German company near Mugher town, 90 km North West of Addis Ababa. In 1999 Mugher Cement Enterprise was reestablished with an authorized capital of 334.7 million birr through amalgamation of two formerly independent factories – Mugher Cement Factory and Addis Ababa Cement Factory. The factory is managed by the Chemical Industry Corporation.

In recent years, Mugher Cement has not been profitable due to the cumbersome cost of heavy fuel oil the factory uses to burn limestone. Last year, the factory began using coal and is now moving towards profitability, according to Tebabal.

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