Enel’s renewable energy arm, Enel Green Power, has started the construction of a 34 MW grid-connected solar photovoltaic (PV) facility, Ngonye solar PV project, located in southern Zambia.
Zambia’s Industrial Development Corporation (IDC) had awarded the project to Enel Green Power in June 2016. The Enel Group will be investing $40 million in the construction of the project. The project is expected to be commissioned in the first quarter of 2019.
In June, the Enel Group signed a financing agreement to partially fund the project for $34 million with Zambia’s Industrial Development Corporation (IDC) for the construction of the project. This included senior loans of up to $10 million from the International Financing Corporation (IFC), a member of the World Bank Group, up to $12 million from the IFC-Canada Climate Change Program, and up to $11.75 million from the European Investment Bank (EIB).
Once completed, this project is expected to produce around 70 GWh of solar energy per year, offsetting over 45,000 tons of carbon dioxide annually. The solar facility, which is located in the Lusaka South Multi-Facility Economic Zone in southern Zambia, is part of the World Bank Group’s Scaling Solar program.
“The start of construction of Ngonye solar plant is a new milestone in the strengthening of the Enel Group’s presence in the African continent, where we already are the first private renewable operator in terms of installed capacity,” said Antonio Cammisecra, Head of Enel’s Global Renewable Energies Division, in a press statement.
Ngonye solar project, which will be owned by a special purpose vehicle (held 80 percent by EGP and 20 percent by IDC) is supported by a 25-year power purchase agreement signed with Zambia’s state-owned utility ZESCO.
“Ngonye, with its clean, sustainable and reliable power, will play a significant role in helping Zambia to meet its electrification goals, demonstrating once again that renewable utility-scale power plants are the most effective solution to give access to electricity in the continent,” added Cammisecra.
Zambia, which features average annual growth in electricity consumption of around five to six percent and a significant need to diversify its energy generation mix dominated by hydro, aims to increase the security and quality of supply while encouraging the electrification of rural areas.
For this reason, Zambia’s government launched a series of initiatives to promote the development of renewables, with a particular focus on solar photovoltaic power, setting the goal to install up to 600 MW of solar power within the next two to three years.
Under this framework, IDC launched a tender for the development of two PV projects with a total capacity of up to 100 MW, according to the World Bank Group’s Scaling Solar program, with the International Finance Corporation acting as advisor.
Recently, the government of the Republic of Zambia launched the Renewable Energy Feed-in-Tariff (REFiT) program with the objective of bringing 200 MW of renewable energy onto the grid within the next three to five years, divided into 100 MW of solar PV and 100 MW of small hydropower.
Mercom previously reported that Sterling & Wilson, a global solar engineering, procurement, and construction (EPC) company is providing EPC services for the construction of Zambia’s first utility-scale solar project with a capacity of 54 MW.
Previously, the International Financial Corporation (IFC), a member of the World Bank Group, and the government of Canada joined hands to support Zambia with $25 million in financial aid for clean and affordable energy.
Image credit: Total
Saumy is a senior staff reporter with MercomIndia.com covering business and energy news since 2016. Prior to Mercom, Saumy was a copy editor at Thomson Reuters. Saumy earned his Bachelors Degree in Journalism & Mass Communication from the Manipal Institute of Communication at Manipal University. More articles from Saumy Prateek.