Mozambique’s first solar power plant has secured financing. Construction is expected to start in May, with the facility operational by early 2019, government sources have told Lusa.
“It will be the country’s first large-scale solar plant, and represents an important step in Mozambique’s ambition to increase the renewable sources share of its electricity production,” the developer said.
The large solar panel array will cover a 126-hectare site in Mocuba, central Zambezia province, and is the result of a partnership between Scatec Solar (52.5%), the Norwegian state investment fund Norfund (22.5%) and Mozambique Electricity (EDM) (25%).
EDM, Mozambique’s public electricity company, will buy from the facility enough energy to supply 175,000 households, and distribute it through the national electricity grid.
According to an EDM report seen by Lusa, the power station will help address deficiencies in electricity supply in the northern half of the country, as well as promoting the development of Mocuba.
The project has a 25-year life expectancy and will supply 85% of the region’s annual energy needs. Two hundred and sixteen thousand people live in the region, but only 8% of households have electricity. The project is expected to raise that proportion to a quarter.
During the construction phase, the project is expected to employ 200 people and “boost local businesses in the areas of accommodation, catering, rental and sale of essential goods,” the EDM report said.
During its production phase, the project will spend 0.75% of annual revenues on social projects in the region.
The EDM document says solar power is the cheapest way to produce electricity in the region, as well as the best option for rural electricity supply in particular. The project will also diversify Mozambique’s energy sources.
Financing has been arranged: US$76 million in investment, US$14 million provided by partners, US$7 million in donations from other sources and US$55 million from a loan negotiated through the World Bank, the Climate Investment Funds initiative and the British Department for International Development.
The Norwegian government is supporting the Mozambican state and will cover EDM’s 25% share.
For EDM, the investment is also a way of gaining experience in managing photovoltaic plants, which have the advantage of rapid construction compared to hydro-electric and other fuel-powered generating modalities.
In September 2017, the Mozambican government presented a portfolio of renewable energy projects intended to provide universal access to electricity in the country by 2030.
About 300 villages will be electrified using hydro-electric generation, and as many again using solar projects, according to Ministry of Mineral Resources and Energy estimates.