Zambia: ZESCO Signs 25-Year Deal To Offtake Power From 400MW Sinazongwe Thermal Plant

Zambia’s power utility company, ZESCO Limited, has agreed to offtake the entire output from a 400-megawatt thermal power plant currently under construction in the Sinazongwe–Sinazeze area, being developed by a Zambian company at a cost of US$561 million.

According to ZESCO Chief Operating Officer Fitzpatrick Kapepe, the utility has already agreed to purchase the plant’s entire electricity output under a 25-year Power Purchase Agreement (PPA).

Kapepe said the project would strengthen Zambia’s energy security, as thermal power generation is not affected by droughts, unlike hydropower.

“We have had discussions with Ezra. We will actually off-take the whole 400MW, obviously less auxiliary losses. This power is going to be off-taken by ZESCO under a power purchase agreement, which will run for 25 years,” Kapepe said in a report by Kalemba.

“The most important thing we need to understand is that the thermal plant is resilient to droughts. Whether we have rains or not, it will still be able to generate power and send electrons to the growth centres of this country.”

He said the additional power would support industries, mining activities, and agriculture as the country works toward its ambitious economic targets.

Kapepe noted that the country is targeting 10,000MW in generation capacity, and the new plant would contribute significantly toward achieving that goal.

“This is baseload power; it is very firm power. It will support the growth centres of the economy. We have the mines, and we know the President’s vision of increasing copper production from just under one million metric tonnes to three million metric tonnes,” he said.

“We also understand the target is to produce 10 million metric tonnes of maize and three million metric tonnes of soya beans. This means we still need power to extract value from those growth centres and advance the President’s vision.”

Ezra Group Chief Executive Officer Meron Ezra said the project will be implemented in two phases of 200 megawatts each.

Ezra disclosed that Phase One has already commenced following the completion of pre-construction works this month.

“We have a 400MW power plant project being done in two phases. Phase One is 200 megawatts and Phase Two is also 200 megawatts. Phase One has already started, and we have completed all pre-construction works,” Ezra said.

He added that the entire project would cost US$561 million and is expected to create between 1,200 and 1,500 jobs during the construction phase.

Ezra further noted that the first 200MW phase is expected to be completed and commissioned by the end of next year, while the second phase is scheduled for commissioning in December 2029.

He said the project is currently about 20 percent complete and is progressing well.

According to Ezra, the coal-fired plant will add stability to the national grid, increase access to electricity, and create opportunities for further investment in the country’s economy.