Zimbabwe says it is in talks with the Dubai unit of SkyPower, a renewable energy projects developer, to build 500MW of solar plants in the country.
The proposed solar parks would be built in phases, the government said on Tuesday, but gave no financial details.
“The Framework Agreement will pave way for engagement between SkyPower Global and ZESA Holdings in order for the two entities to negotiate a Power Purchase Agreement as well as other ancillary agreements relevant to power generation,” Information Minister Monica Mutsvangwa said.
The talks were an outcome of talks between UAE companies and Zimbabwean officials at the Dubai Expo 2020 this year, she said.
According to its website, SkyPower says it has built and acquired a pipeline of over 25GW worth of power projects in the Middle East, Africa, and Asia.
Searching for solar
Because of the constant breakdown of ageing thermal plants, Zimbabwe is facing a critical power shortage, which industrialists say may cut productivity this year.
Zimbabwe is pushing for private investment into renewables to fill the power deficit, and the government announced bids for 500MW of solar in 2020. However, the country’s currency risk has kept many investors away. Private investors fear that they would not be paid profitable tariffs for the power they would sell to ZESA.
Under IPP arrangements, companies source their own capital, build plants, and then sell the power to customers.
Zimbabwe has issued permits for a combined capacity of close to 7000MW, but independent power producers are supplying only about 135MW to the grid.
In July last year, Zimbabwe announced talks with AF Power of Singapore under which the company would build 200MW over three years, starting with a first phase of 50MW in Umguza by 2022. However, the project is yet to take off.
But local investors remain keen on green energy. CBZ, the biggest bank in Zimbabwe, has said it plans to invest 2% of its annual income toward renewables. Old Mutual, the country’s largest insurer and one of Zimbabwe’s dominant investors, is also invested in locally-led solar projects such as Solgas, Richaw, Kupinga and Harava energy projects.