- The Sustainable Energy Fund for Africa (SEFA), managed by the African Development Bank, has committed to contribute $8 million toward a $26.5 million financing package to support the 32 MW Ilute Solar Project in Zambia.
The project, an Independent Power Producer (IPP) located in Western Zambia, will supply electricity via the Southern African Power Pool (SAPP) under a market-based Power Purchase Agreement (PPA) with regional power trader GreenCo Power Services Ltd, an innovative regional power trader. This structure will avoid burdening the Zambian government’s balance sheet and bypass the need to secure sovereign guarantees. It is expected to provide a model that can be replicated in other countries seeking to attract private capital and promote regional energy integration.
The Ilute Solar Project aligns with Zambia’s strategic objective of leveraging the SAPP to mobilise private capital, reinforce energy security, and modernise its electricity system. It also aligns with the African Development Bank’s New Deal on Energy for Africa and the M300 initiative.
Additionally, under a biodiversity plan developed with the World Wide Fund for Nature (WWF), the project allocates 1% of annual revenues to a community trust governed by local representatives to fund locally prioritised development initiatives.
Author: Bryan Groenendaal
