ZESCO has contracted Sinohydro Corporation Limited of China to construct the 750 megawatts (MW) Kafue Gorge Lower (KGL) hydro power station in Chikankata District at a cost of US$2 billion.
Zesco acting managing director Victor Mundende said the four-year project was aimed at increasing hydro-generated electricity as the country’s demand had been growing and currently stands at 1 948 MW per annum.
Mr Mundende said the project, which also aims to address the growing demand for electricity in the Southern African Power Pool (SAPP), would be financed by the Government and foreign financial institutions, among them, the Exim Bank of China.
The Government, which would contribute 15 per cent equity financing of the total project cost, has since released $186 million to Zesco as part of the initial investment contribution.
Mr Mundende was speaking at the Zesco head office in Lusaka yesterday at the signing ceremony for the engineering, procurement and construction of the KGL project with Sinohydro following the completion of pre-contract discussions recently.
“The development and construction of the KGL hydro electric project needs to be fast-tracked, completed and commissioned to meet the increasing energy demand both in Zambia and SAPP,” Mr Mundende said.
He said once completed, the facility would be connected to the national electricity grid via a 330-kilovolt transmission line approximately 100 kilometres up to the Lusaka West substation via the south multi-facility economic zone.
“In the advent of the power shortages that the nation is currently experiencing, the development of this project is in the critical path,” Mr Mundende said.
Sinohydro Corporation vice-president Liu Kai said that his firm would move on site as soon as all financing procedures were completed.
“We understand the urgency of this project because we are familiar with this market. Let me assure you that the project will be executed in good time,” said Mr Liu, whose firm is responsible for 50 per cent of the world’s functioning hydro power plants.