Energy & Renewables
LevrAge Sector Report: Energy & Renewables (2025)
Executive Summary
- **Hydropower backbone, rapid diversification.** 85% of current generation is hydro (3,700 MW); policy actively pushing solar, wind, biomass, and geothermal to reduce climate risk and meet surging demand.
- **Aggressive growth trajectory.** From 3,700 MW (2025) → 10,000 MW (2030) → 23,000 MW (2050) driven by mining electrification, grid reliability, and regional SAPP trade opportunities.
- **Bankable policy posture.** Single Licensing System (ESLS), 25-year PPAs, open access for private off-takers, and REFiT bands signal strong private-sector pull-in with DFI backing.
- **Dual-track opportunity.** Utility-scale IPPs for grid-connected projects plus mini-grid/off-grid solutions for rural electrification unlock blended-finance opportunities across risk profiles.
- **ZECS competitive advantage.** Investors with credible licensing pathway, land rights, EIA baselines, and anchor off-taker commitments clear approvals 40% faster and command better PPA terms.
ZDA Investment Landscape
Why Energy Matters to Zambia
Strategic Position:
- Hydropower backbone: 85% of current generation (3,700 MW installed)
- Massive growth trajectory: 3,700 MW (2025) → 10,000 MW (2030) → 23,000 MW (2050)
- Regional energy hub potential: SAPP (Southern African Power Pool) integration
- Renewable energy champion: Solar, wind, biomass, geothermal untapped
Government Priorities
8th National Development Plan (8NDP) Focus:
- Universal electricity access by 2030 (current: 45% national, 10% rural)
- Diversify generation mix (reduce hydro dependency from climate risks)
- Private sector-led expansion through PPAs and IPPs
- Mini-grids and off-grid solutions for rural electrification
Investment Incentives & Policy Framework
Single Licensing System (ESLS): Streamlined regulatory approvals
Open Access PPAs: Direct power purchase agreements with off-takers
Net Metering: Feed excess generation back to grid
VAT exemption on renewable energy equipment
100% foreign ownership permitted
25-year PPA terms with ZESCO and private off-takers
REFiT (Renewable Energy Feed-in Tariff):
- Solar PV: $0.08-0.12/kWh
- Small hydro (under 10 MW): $0.06-0.10/kWh
- Wind: $0.08-0.11/kWh
- Biomass: $0.08-0.13/kWh
Sector Statistics
- Installed Capacity: 3,700 MW (2025), 85% hydro, 15% diesel/coal
- Demand Growth: 8-10% annually
- Unmet Demand: 500-800 MW during peak periods
- Rural Access Gap: 5.5M households without electricity
- FDI Target: $5B+ in energy sector (2025-2030)
- Planned Projects: 71 MW solar-wind, 118 MW hydro, 300+ MW solar pipeline
ZECS Readiness Requirements
To be competitive for PPAs, SEZ offtake, and ministerial approvals:
Regulatory & Compliance Pathway (20% of ZECS score)
- Energy generation or distribution license application (ERB)
- EIA certificate or application (ZEMA)
- Grid connection study or off-grid feasibility
- Land title or MoU with landowner (solar/wind farms)
- Water abstraction permit (hydro projects)
- Unclear licensing stage (generation vs. distribution)
- Missing grid impact assessment
- No land tenure documentation
- Incomplete environmental baseline
- Engage with Energy Regulation Board (ERB) early
- Secure anchor off-taker before financial close
- Partner with established Zambian energy firms
- Plan for local technician training programs
Local Partner Fit (20% of ZECS score)
- Zambian partner or local EPC contractor engagement
- O&M plan with local skills transfer
- Off-taker MoU or LOI (ZESCO, mining companies, SEZs)
- Community benefit-sharing framework
- Local content plan (30%+ target)
- Engage with Energy Regulation Board (ERB) early
- Secure anchor off-taker before financial close
- Partner with established Zambian energy firms
- Plan for local technician training programs
Financial Preparedness (15% of ZECS score)
- Project feasibility study (bankable)
- CapEx breakdown and financing plan
- 20-25 year PPA or offtake agreement
- DFI engagement (AfDB, IFC, DFC, USTDA)
- FX hedging strategy
LevrAge Facilitation Pathway
Phase 1: Entry Strategy (60-90 days)
Our Role:
- Map ERB licensing pathway and timelines
- Identify suitable off-takers (mining, manufacturing, SEZs)
- Assess grid connection vs. off-grid viability
- Facilitate introductions to ZDA energy desk
Deliverables:
- Energy sector entry roadmap
- Off-taker long-list (10-15 potential anchor clients)
- Regulatory checklist and timeline
Phase 2: Stakeholder Engagement (90-150 days)
Our Role:
- Coordinate meetings with Ministry of Energy
- Facilitate ERB and ZEMA consultations
- Connect with ZESCO for grid connection studies
- Arrange site visits and resource assessments
Phase 3: Deal Structuring (120-240 days)
Our Role:
- PPA negotiation support and template guidance
- SEZ offtake agreement facilitation
- DFI and blended finance introductions
- EPC contractor vetting and shortlisting
Typical Timeline: 9-18 months from concept to financial close
Active Opportunities
Featured Project: 71 MW Solar-Wind Hybrid
Investor: U.S.-based renewable energy developer
Technology: Solar PV + Wind + BESS
Location: North-Western Province
Stage: Financing
Investment: $80-120M
Systemic Value Score: 78% (High Impact)
Why It Matters:
- First utility-scale hybrid in Zambia
- Reduces hydro dependency during dry seasons
- Anchor off-taker: Mining corridor
- DFC and AfDB financing interest
- Creates 300+ construction jobs, 50 permanent
ZECS Status: Verified (Silver tier, upgrading to Gold)
Featured Project: 118 MW Mulembo Lelya Hydro
Investor: PPP/FDI consortium
Technology: Run-of-river hydropower
Location: Luapula Province
Stage: Feasibility → Financing
Investment: $285M
Systemic Value Score: 82% (Catalytic)
Why It Matters:
- Diversifies hydro portfolio with new basin
- 25-year PPA with ZESCO
- Regional export potential (SAPP)
- Community co-benefits (irrigation, fisheries)
- IFC and AfDB engagement
ZECS Status: In Process (targeting Gold tier)
Sector Outlook & Trends
2025-2030 Opportunities
Utility-Scale Solar & Wind
- 300-500 MW solar pipeline across provinces
- Wind potential in Northwestern and Southern provinces
- Hybrid solar-wind-BESS projects (grid stability)
- Floating solar on hydro reservoirs (emerging)
C&I and SEZ Power
- Mining companies: 100-200 MW captive solar demand
- Manufacturing SEZs: 50-100 MW distributed generation
- Data centers: Renewable-backed colocation facilities
- Cold chain and agro-processing: Solar + storage
Rural Electrification & Mini-Grids
- 5,000+ villages without grid access
- Solar home systems (SHS) market: 500K+ units needed
- Mini-grids: 50-500 kW (health, education, agribusiness anchor loads)
- Pay-as-you-go (PAYG) financing models
Grid Modernization & Storage
- Smart grid pilot projects
- Battery energy storage systems (BESS)
- Demand-side management platforms
- AI-powered grid optimization
Key Success Factors
✅ Secure anchor off-taker early (mining, SEZ, ZESCO)
✅ Engage ERB and ZEMA proactively (avoid licensing delays)
✅ Leverage DFI support (de-risk with blended finance)
✅ Plan for grid connection early (ZESCO timelines can be long)
✅ Design for local O&M (skills transfer = sustainability)
Next Steps
For Investors
- Start with Free ZECS Precheck → Get Your Score
- Review Active Pipeline → ZDA Pipeline Console
- Download Meeting Prep Guide → Embassy Readiness Checklist
- Book Consultation → Schedule 30-Min Assessment
For Partners
- Submit Opportunity → Project Intake Form
- Request Partnership Brief → Contact Us
- Zambia Development Agency (ZDA): Energy sector profiles
- Energy Regulation Board (ERB): Licensing and tariffs
- Ministry of Energy: National Energy Policy (2019)
- ZESCO: Grid connection and PPA procedures
- Rural Electrification Authority (REA): Mini-grid guidelines
- LevrAge Resources: Zambia Investment Roadshow 2025 Results, ZECS Methodology, SVS Framework
Disclaimer
This sector brief is provided for informational purposes and reflects publicly available data from ZDA and government sources. It does not constitute investment advice, legal guidance, or an endorsement by the Zambia Development Agency or Government of Zambia. ZECS is an independent readiness assessment by LevrAge Strategy & Solutions. All investors should conduct their own due diligence and consult qualified legal, financial, and technical advisors before making investment decisions.
Last Updated: October 12, 2025
Contact: LevrAge Strategy & Solutions | info@levrage.solutions
Learn More: www.levrage.solutions
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