Solar Power Venture in Kariba Secures $250 Million: Green Activists Concerned Over Hwange Development
The Intensive Energy User Group (IEUG), a voluntary association of private organisations in Zimbabwe, has made significant strides in the renewable energy sector with its proposed Kariba Floating Solar Project.
The IEUG, which represents about 40% of the domestic power demand in Zimbabwe, has formed three subsidiary companies, one of which is Green Hybrid Power Pvt Ltd (GHP), tasked with implementing the solar project.
Edward Cross, the chairman of the IEUG, has claimed that they received "oversubscribed" interest for financing, a testament to the project's potential. The African Export-Import Bank (Afreximbank) has secured $250 million for the construction of the floating solar panels at Kariba.
The IEUG presented their plans for the solar project during the Africa Investment Forum in Morocco. Under the Power Purchase Agreement (PPA), the IEUG will sell electricity generated by the project to the off-taker at agreed terms, such as a fixed price per kilowatt-hour (kWh) or with periodic adjustments.
The PPA is a key document in renewable energy projects, as it reassures lenders like Afreximbank that the project has a stable income stream, making the loan less risky. The PPA provides financial certainty to both parties, assuring the IEUG of revenue over two decades, which is crucial for repaying the funding provided by Afreximbank and ensuring the project's financial sustainability.
The IEUG holds a 20-year transmission agreement to connect to the national grid, which likely includes guarantees for the sale of solar energy into the grid. This agreement, coupled with the PPA, provides a robust foundation for the project's success.
The Kariba Floating Solar Project is expected to be implemented within 18 months. The IEUG, which has been trading power successfully and profitably for the last 19 months, is also involved in electricity transmission and distribution business.
In addition, the IEUG is investing massively in transmission infrastructure in the region, estimating they will need to invest US$3 billion in transmission over the next five years. This investment will further bolster the country's energy infrastructure and support the growth of renewable energy projects like the Kariba Floating Solar Project.
The IEUG plans to develop a 250 MW solar plant at the Kariba Dam, with potential expansion to 1,000 MW. This ambitious project, if successful, could significantly boost Zimbabwe's renewable energy capacity and contribute to the country's energy security.
The search results do not provide information about the name of the person leading the IEUG at this time. However, the organisation's commitment to sustainable energy projects and its strategic partnerships with entities like Afreximbank are clear indicators of its dedication to Zimbabwe's energy future.
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