Overview
Zambia has 2,800 MW of installed electricity generation capacity, of which 83 percent is from hydro, nine percent from coal, five percent from heavy fuel oil, and three percent from solar. The mining sector is the country’s largest power consumer, using 51 percent of total generated electricity, followed by the domestic sector at 33 percent. Only 43 percent of Zambians have access to the national power grid (67 percent of urban residents; and 14.5 percent of rural residents).
ZESCO, a vertically integrated parastatal utility, operates government-owned power stations, and is responsible for maintaining and installing transmission lines and distribution networks. Zambia’s electricity market is structured as a single-buyer market, with ZESCO acting as the sole off-taker and bulk retailer of electricity through the national grid. Independent Power Producers (IPPs) operate their own assets and generate electricity, however, to distribute it via the grid, they must sell the electricity to ZESCO through Power Purchase Agreements (PPA). Off-grid IPPs can operate and distribute independently. Zambia’s main hydroelectric power facilities are the Kariba North Bank Power Station (1,080 MW), Kafue Gorge Power Station (980MW), Kafue Gorge Lower Power Station (750 MW), Victoria Falls Power Station (108 MW), Lunsemfwa Hydro Power Station (56 MW), and the Itezhi Tezhi Hydro Power Station (120 MW). Maamba Collieries Limited operates Zambia’s largest IPP, a coal-fired thermal power plant commissioned in 2016, which can generate up to 300 MW.
Zambia’s installed solar capacity is 89 MW. Zambia has two utility scale solar power plants: French company, Neoen, and U.S. company, First Solar, own and operate the 47.5 MW Bangweulu Solar Power Station in Lusaka, of which the Zambian government holds a 20 percent stake through its Industrial Development Corporation (IDC). Italian firm, Enel Green Power, owns and operates the 34 MW Ngonye Solar Power Station, in Lusaka Province.
Sub-Sector Best Prospects
Solar Power:
Zambia has abundant potential to generate additional solar power as it possesses ample and intense sunlight, averaging about 2,000 - 3,000 hours of sunshine per year.
Power Africa
Power Africa is a market-driven, U.S. Government-led public-private partnership aiming to double access to electricity in sub-Saharan Africa. It offers tools and resources to private sector entities to facilitate doing business in sub-Saharan Africa’s power sector. The Electrify Africa Act of 2015 institutionalized Power Africa. Learn more about the full Power Africa toolbox (https://www.usaid.gov/powerafrica/toolbox) or other opportunities offered by Power Africa (https://www.usaid.gov/powerafrica/aboutus). Power Africa has supported the development of 208 MW of electricity generation projects in Zambia. In addition, various firms have received U.S. Embassy support to move transactions forward. This link provides an overview of the energy sector in Zambia, explains Power Africa’s involvement and lists Power Africa’s financially closed transactions in country.
Opportunities
Given Zambia’s continually growing power needs, for commercial and residential use, and ability to export through the Southern Africa Power Pool, there are significant investment opportunities in on- and off-grid power generation, particularly with regards to renewable energy sources.
There are opportunities in electricity generation and transmission, storage, particularly with regards to renewable energy sources (i.e. wind, solar, and hydro). While Zambia has the potential to generate 2,300 MW of solar and 3,000 MW of wind, only 76 MW of solar has been installed and there is no wind power to date.
Key government and regulatory agencies for energy and solar projects:
Industrial Development Corporation (Zambia) Limited
610 Independence Avenue, Prospect Hill
P.O. Box 37232, Lusaka, Zambia
Tel: +260 211 843 567 | +260 211 843 568 | +260 967 773 007
Ministry of Energy
Mulungushi House
P.O. Box 50069
Lusaka, Zambia
Tel: +260 211 252 666 | +260 211 252 698
Energy Regulation Board
Plot No 9330,
Off Alick Nkhata Road
P.O. Box 37631
Lusaka, Zambia
Tel: +260 211 258 844 | +260 211 258 849
https://www.erb.org.zm