Zimbabwean energy group to raise $250m for floating solar plant

8 Jul 2023
Zimbabwean energy group to raise $250m for floating solar plant

Business group leads effort for 1GW floating solar plant on man-made Lake Kariba, sourcing funds from African Finance Corp. and others; floating solar PV at forefront of innovative proposals for continent’s vast hydro resources

According to a report by Bloomberg news, Zimbabwe’s Intensive Energy User Group (IEUG) plans to raise $250 million to construct the first phase of a floating solar PV plant on Lake Kariba. The lake is located on the country’s border with Zambia.

This development follows earlier discussions between China Energy, the state-owned Zimbabwe Power Company, and IEUG. In March, Reuters reported that the Chinese company had submitted a proposal for the construction of a 1GW floating solar plant on the man-made lake. The plant is estimated to cost $987 million and will comprise about 1.8 million solar panels.

The stakeholders plan to set up a development company – the Kariba Floating Solar Development Company – which will be majority owned by IEUG members (52 percent) to implement the project. Zimbabwe’s sovereign wealth fund will own 10 percent and the remaining stake available to institutional investors.

The IEUG is a private sector-led effort to improve the energy supply in Zimbabwe. The group is composed of companies, mainly mining firms, consuming over 1MW daily.

First phase PPA

The first phase of the project involves the construction of a planned 250MW of solar PV capacity for which pre-feasibility studies are currently being carried out, according to the Bloomberg news report.

The power generated from the plant will be sold to the IEUG and other customers under a 25-year power purchase agreement (PPA).

Excess energy generated from the plant will also be exported to the Southern African power pool. The IEUG has as part of its objectives, the trade of energy within the region.

In April, Zimbabwean media outlet, The Herald, reported that Caleb Dengu, a non-executive director at IEUG and a managing partner of CDF Trust and Consulting BV Ltd – a key promoter and coordinator for the project – stated that the project will source funds from African infrastructure investors such as the African Finance Corp. and Africa50.

Mr. Dengu also added that the project is aiming to reach financial closure by the first quarter of next year.

Africa’s solar PV generation potential

The bid to improve clean energy integration on the African continent has seen the proposal of innovative deployment models that accommodate the continent’s infrastructural limitations. Floating solar PV has been at the forefront of these proposals given the continent’s vast hydro resources.

The first floating project in Africa was commissioned in Tunisia last year. The 200kW plant was developed by the French renewables company, Qair. Authorities believe that this will demonstrate the viability of floating solar and provide a template for the construction of larger projects.

A 2021 study by researchers at the European Commission’s Joint Research Centre estimated the floating solar PV generation potential of the 146 largest hydropower reservoirs in Africa to be 2,922GWp. The study finds that covering only 10 percent of the surface of these reservoirs with solar panels will generate 529,349GWh of electricity annually.

For a continent that is prone to the impacts of climate change, floating solar also provides an added benefit. They help to reduce evaporation loss, improve hydropower generation and alleviate water scarcity issues.

For instance, the study estimates that covering Lake Kariba with solar panels will increase hydroelectricity generation by 20GWh annually and save about 50 -75 million cubic meters of water.

Energy & Utilities reported last year on progress of the planned 1,500MW Mphanda Nkuwa Hydropower Project in Mozambique. E&U reported earlier this year on carbon credit sales for African off-grid including in Zimbabwe. 

Photo Credit: Marcus Wishart, World Bank Group

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