- Five years after announcing The GETFit Zambia tender success, the latest annual update reports no progress made on getting 120MW of awarded solar PV projects over the line.
- Using mainly foreign recruited individuals allegedly with no undertstanding or experience in the local context, a public Solar PV tender was announced in 2018, and six Solar PV projects were awarded to three successful bidders in April 2019.
- Zambia’s sovereign debt and its associated understatement by the Zambian government was first raise by this publication in April 2018, prompting commentators to question why GETFit Zambia went ahead with their programme knowing full well that the projects will never be bankable with institutional investors.
- Zesco, Zambia’s state owned power utility has a total debt of USD 3.5 billion as at September 2021. Read more
GET Fit provided an update last week announcing that developers remain committed to implementing projects and have agreed to extend bid validity, while GET FiT Secretariat and KfW remain engaged in onboarding potential lenders. The Secretariat also explored alternative offtake solutions with investors and financiers. However, merchant risk, the energy tariff structure, and at the time, there were no credit-worthy off-takers with a proven track record in Zambia to off-take power from the projects. Furthermore, it was considered not financially beneficial for ZESCO and its consumers to purchase power at a margin instead of benefiting from the low cost achieved through the tender.
This was especially important as the programme objectives were to ensure that broader public benefits from low-cost power procured through the programme. Therefore, stakeholders have agreed that ZESCO will remain the off-taker for the GET FiT projects, especially as the programme design and deployment of grants aim to ensure a low costs tariff outcome that will benefit the broader ZESCO customer base.
Link to their full report: GETFiTZambia_AnnualUpdatel2022indd
Author: Bryan Groenendaal