ENEL enters Zambia renewables market with 34 MW of PV capacity
Enel, acting through its renewable energy divison Enel Green Power (EGP), has been awarded the right to develop, finance, construct, own and operate a 34 MW1 PV solar project in Zambia following the Scaling Solar programme first round tender launched by the state-owned investment holding company Industrial Development Corporation Limited (IDC). Mosi-oa-Tunya, which is located in Lusaka South Multi-Facility Economic Zone in southern Zambia, marks the entry of Enel in the country's renewables market.
"This is a landmark award for EGP, underlining the consistent development of a gradually and well planned expansion in selected areas of the African continent where the company can play a key role in providing smart, efficient and sustainable energy solutions," said Francesco Venturini, Head of Enel's Global Renewable Energies division, Enel Green Power. "Our entry into Zambia "“ a country offering a very attractive investment proposition "“ is another step forward in this respect and we are proud to contribute to the Scaling Solar programme, one of the best-designed schemes for renewables in Africa."
Enel will be investing approximately 40 million US dollars in the construction of the new PV plant, as part of the investment programme indicated by the company's current strategic plan. The project will be supported by a 25 year-long power purchase agreement (PPA) for the sale of all the energy generated by the plant to the state-owned utility ZESCO. The project, which will be owned by a special purpose vehicle (SPV) in which IDC will maintain a 20 percent minority stake in line with tender's regulation, is expected to enter into operation in the second quarter of 2017 and will generate around 70 GWh per year.
Zambia is characterised by a strong growth in electricity consumption (with an average of around 5-6 percent per year) and the need to diversify its energy generation mix which is dominated by hydro. The country also aims to increase the security of supply, improving service quality and encouraging the electrification of rural areas. In this context, Zambia's government has launched a set of initiatives to promote the development of generation capacity from renewable sources, focusing in particular on photovoltaic power, with the goal of installing up to 600 MW within the next two to three years. Round 1 of the Scaling Solar programme carried out by IDC is part of these initiatives and provides for the development of two PV projects with a total capacity of up to 100 MW; IDC has structured the tender according to the Scaling Solar initiative developed by the World Bank, with the International Finance Corporation (IFC) acting as advisor.
