- Vungu Solar Pvt Ltd has announced the signing of a Government Project Support Agreement (GPSA), with the Government of Zimbabwe.
- The announcement marks an important step towards the realisation of the 30MW Vungu Solar project, which is set to be among Zimbabwe’s first internationally project-financed solar Independent Power Producers (IPPs) selling to the Zimbabwe Electricity Transmission and Distribution Company (ZETDC).
Founded by Energywise Equipment (Pvt) Ltd (Energywise) in 2014, Vungu Solar is being developed by the Private Infrastructure Development Group (PIDG) – through its project development solution, InfraCo – alongside Energywise and Impala Power Company Ltd (Impala). InfraCo’s work in Africa is supported by the governments of the UK, the Netherlands, and Switzerland.
The project was selected by the Government of Zimbabwe as its preferred bidder in a national pilot designed to create an enabling environment for future investment into the country’s solar sector. With support from the African Legal Support Facility (ALSF), and in negotiation with the Vungu Solar team, a cross-government group, led by the Ministry of Energy and Power Development, have prepared standardised, bankable PPA and a GPSA — a policy tool designed to de-risk IPP investments through guarantees, cost-reflective tariffs, and currency convertibility provisions — the signing of which was announced in Cape Town today. The ALSF assistance to the Government included legal and financial support from Covington & Burling LLP and Manokore Attorneys on the legal aspects, and EY Transactional Advisory Services on the financial aspects.
It is anticipated that, by piloting the use of bankable, standardised documentation, Vungu Solar will enable the Government of Zimbabwe to attract significant future development finance and private sector investment to grow the country’s renewable energy sector. The project expects to reach financial close and commence construction in 2026.
Author: Bryan Groenendaal
