POWER Ventures (Pvt) Limited, a subsidiary of Southern Energy, expects to bring online the first phase of its 100 megawatt (MW) Victoria Falls-Chidobe solar plant in Hwange district by early 2025.
The firm is expected to commission a 5MW plant in the first phase, which will then be increased to 20MW and eventually 100MW upon completion.
The project, situated near the Victoria Falls International Airport, started about four years ago and the first phase was supposed to be completed in December 2022.
However, this phase was stalled following the outbreak of the COVID-19 pandemic, coupled with challenges revolving around access to foreign currency to import equipment.
“The project is designed as a 25MW solar PV [photovoltaic]plant and the intention is that this is commissioned early in the new year, after which we will then raise capital to proceed to build the next 20MW,” Power Ventures director Barry Nyabonda told journalists in an interview during an energy project excursion on Wednesday.
“The biggest challenge, as you already know with these kinds of projects, is that all your materials are purchased in US dollars, they are imported. But our local market is not able to provide long-term funding and also the availability of US dollar funding is non-existent locally.
“So, this is what slows down the implementation of these projects. We think that if the government continues to make efforts to improve the environment for long-term funding in US dollars, then there will be more and more projects coming into the markets more easily.”
The Power Ventures director said the initial phase would cost under US$10 million, while the 25MW would need roughly US$30 million in total.
- Power Ventures to commission 5MW early 2025
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Nyabonda said this has been supported by local and South African investors.
“Solar equipment comes from China, in general. So, the solar panels are from China, the electromechanical equipment is from China, the inverters are also from China. Of course, there are other materials like cement and some steel that you purchase locally,” he said.
“But I would say over 90% of materials are imported. It varies at different stages of construction.”
The company has the option of selling power to the Zimbabwe Electricity Transmission and Distribution Company, a subsidiary of Zesa Holdings, the private sector or the Southern African Power Pool.
“The market is open, but the constraint is on the currency funding,” Nyabonda lamented.
“We are hoping that after this initial phase of 5MW, it will be easier to convince, especially the pension funds, because they are sitting with long term money.
“The banks cannot do it. Banks are giving one-year or two-year loans.”
In 2020, the government issued a tender for the installation of 500MW of solar power capacity, aiming to transition to renewable energy and alleviate devastating power outages.
However, investment in Zimbabwe’s solar sector has been hindered by investor concerns over payment in US dollars for electricity supplied.
The government has been reluctant to provide independent power producers with the payment guarantees they require.
