Western Power Company hydropower

Zambia

The Ngonye Falls Hydroelectric Project is a 180MW run-of-river scheme in the Western Province of Zambia, which is under development by the project SPV Western Power Company (WPC).

The project is owned and developed by the project’s local founders African Power Projects Ltd and InfraCo Africa.  eleQtra is Principal Developer for InfraCo Africa and as such has been working towards the realisation of this project on InfraCo Africa’s behalf since they entered the project in 2015, alongside the local partners.

The planned hydroelectric station at Ngonye Falls could generate power several times greater than the current total consumption of Western Province, and will be the largest private investment in western Zambia. The project will contribute to strengthening and stabilisation of the Zambian power network and reduce power flows and losses from southern Zambia to western Zambia and neighbouring countries.  The project site, which has excellent existing road access, is located close to growing load centres in Zambia and Angola as well as interconnectors to the power grids of Namibia, Botswana and Zimbabwe.

In recent years Zambia has been unable to meet growing demand for electricity, and this combined with recent poor rainfall has led to severe shortages and had a negative impact on economic development.   Furthermore, Zambia has expressed a desire to become a net exporter of power, and the project will be well-placed assist with this national macroeconomic objective.

Primary Economic Benefits

  • Support the Government of Zambia’s policy of increasing installed capacity in the country in order to eliminate the power deficit, support increased economic growth and access to electricity, and potentially provide a source of export earnings.
  • Establish a commercially viable hydroelectric plant in Western Province, contributing to the development of the province through jobs, economic development, and through community development benefits being agreed as an important local element of the project’s development process.

Primary Social Benefits

  • Local communities will see tangible and sustainable benefits from this major infrastructure development. The project company WPC has committed to long term community improvement through equity participation and a Community Development Fund. The Community Development Fund will be maintained from annual payments coming from project revenues, and administered by a trust with broad local membership and conforming to international governance requirements.
  • Employment creation in the local community during the construction and operation period, in addition to some jobs created during the development period.
  • In addition it will generate “green power” in line with the international agreements aimed at combating climate change such as the Paris Agreement at COP in 2015.

Project Structure

  • The Project is being developed as an Independent Power Producer (IPP) project with an offtake contract under negotiation with the national power utility, ZESCO.
  • The construction will be awarded via a turnkey EPC contract (engineering-procurement-construction).
  • Financing for construction of the project will be raised as a project finance arrangement with development finance institutions and private equity partners.
  • Financial close is expected in 2021, to be followed by a 36-month construction period.

Project Relevance

  • Increased supply of power will facilitate economic development and poverty reduction.
  • The Project is part of a movement in Zambia towards establishing new power generation sources and attracting further investment in the sector, in support of the government’s goals on electrification and becoming a net exporter of power over the coming years.

Western Power Company hydropower

Zambia

Sponsoring government ministries

Ministry of Energy


Approximate scope of project

180MW of hydropower generation on the Zambezi River in Western Province, Zambia.
Overall project costs estimated to be c.$550m.


More Project Information

InfraCo Africa’s partners are the local founders of Western Power Company – meaning that together, WPC has a team of skilled Zambian and international professionals with expertise in engineering, infrastructure development, finance and construction.


Partners

Western Power Company, owned by African Power Projects and InfraCo Africa.