Pan-African development finance institution, AfreximBank, has signed a $4.4 million project preparation facility agreement with Green Hybrid Power to advance feasibility and bankability studies for a 1 GW floating solar photovoltaic (PV) power plant on Lake Kariba in Zimbabwe.
Green Hybrid Power, a subsidiary of the the Intensive Energy Users Group is developing the 1 GW floating solar photovoltaic (PV) power plant and the power generated from the project will be sold to a consortium of large-scale energy consumers, under a 20-year “take-or-pay” power purchase agreement at a cost-reflective tariff.
The project preparation facility by AfreximBank will also fund transaction advisory services to bring the project to financial close. The floating solar project is set to be implemented in two phases. A pilot test phase will target a generation capacity of 500 MW. The estimated investment required to implement the first phase of the floating solar project is about $350 million.
AfreximBank backing key to de-risking of floating solar project
According to Afreximbank, the floating solar PV plant will deliver reliable and competitively priced electricity to energy-intensive industries in Zimbabwe, enabling mineral beneficiation and boosting the country’s export revenues.
The agreement was signed by Kanayo Awani, Executive Vice President, Intra-African Trade and Export Development, on behalf of Afreximbank, and Eddie Cross, Chairman of Green Hybrid Power.
The planned project will be the largest renewable energy development in Zimbabwe. The floating solar facility will mark a significant leap in Zimbabwe’s shift toward renewable energy, reducing reliance on aging coal-fired plants and inconsistent hydropower due to droughts.
The backing of the project by a leading finance institution like Afreximbank will not only de-risk investment into the project, but will also be catalytic in improving the risk perceptions of investing in large scale renewable energy projects in Zimbabwe.
Zimbabwe has so far deployed about 70 MW of solar by the end of 2024, up from 46 MW at the end of the previous year, according to data from the International Renewable Energy Agency (IRENA).
