Cape Town, South Africa: During the Africa Energy Forum (AEF) being held in Cape Town this week, Vungu Solar Pvt Ltd announced the signing of a Government Project Support Agreement (GPSA), with the Government of Zimbabwe. The announcement marks an important step towards the realisation of the 30MWac Vungu Solar project, which is set to be among Zimbabwe’s first internationally project-financed solar Independent Power Producers (IPPs) selling to the Zimbabwe Electricity Transmission and Distribution Company (ZETDC). Vungu Solar is blazing a trail for others to follow by piloting the use of bankable, standardised project documentation which has been developed by the government to attract future investment into harnessing the potential of Zimbabwe’s solar resource.
Honourable Minister July Moyo, the Zimbabwe Minister of Energy and Power Development, said “The Government is ambitious about making progress in the energy sector, and so this occasion is very important. The Vungu Solar project aligns well with the Zimbabwe National Renewable Energy Policy which aims to significantly increase the contribution of renewable energy sources to the country’s overall energy mix. I congratulate all those involved.”
Founded by Energywise Equipment (Pvt) Ltd (Energywise) in 2014, Vungu Solar is being developed by the Private Infrastructure Development Group (PIDG) – through its project development solution, InfraCo – alongside Energywise and Impala Power Company Ltd (Impala). InfraCo’s work in Africa is supported by the governments of the UK, the Netherlands, and Switzerland.
Speaking on behalf of the project, Omar Jabri, PIDG Head of Business Development (Africa) for InfraCo, said, “Today’s signing here at AEF is a milestone for the Government of Zimbabwe’s ambitious programme to attract private sector and development finance into Zimbabwe’s solar sector. PIDG is proud to be working with our partners at Energywise and Impala to pioneer the use of its suite of bankable, standardised project documentation which, it is anticipated, will attract future investment into the scale-up of Zimbabwe’s renewable energy sector. Once built, Vungu Solar will add 30MWac of clean, solar power to Zimbabwe’s national grid, reducing emissions and improving the reliability of power for customers which will, in turn, promote wider economic development.”
CEO of Energywise. Eng. Culven Chipfumbu said of today’s signing, “The signing of the GPSA is a milestone achievement for Vungu Solar as the pilot IPP for the GPSA programme, and this now gives Vungu Solar confidence to negotiate construction funding for the project, backed up by this very important government instrument.”
Speaking from Harare, British Ambassador to Zimbabwe, Pete Vowles said:“We are very pleased that this pioneering investment in Zimbabwe’s clean energy has been finalised, building on hard work from all parties to reach agreement, and an excellent example of cooperation under our bilateral MoU on Renewable Energy. It is also a significant milestone in our UK-Zimbabwe partnership, which is focused on delivering mutual benefits through economic growth and will help us attract further investment into this critical sector that can power the economy, create jobs, and deliver a sustainable future.”
The project was selected by the Government of Zimbabwe as its preferred bidder in a national pilot designed to create an enabling environment for future investment into the country’s solar sector. With support from the African Legal Support Facility (ALSF), and in negotiation with the Vungu Solar team, a cross-government group, led by the Ministry of Energy and Power Development, have prepared standardised, bankable PPA and a GPSA — a policy tool designed to de-risk IPP investments through guarantees, cost-reflective tariffs, and currency convertibility provisions — the signing of which was announced in Cape Town today. The ALSF assistance to the Government included legal and financial support from Covington & Burling LLP and Manokore Attorneys on the legal aspects, and EY Transactional Advisory Services on the financial aspects.
The project will contribute towards delivery of SDG 7 – Access to affordable clean energy – and SDG 13 on climate action.
Vungu Solar will contribute to achievement of the Government of Zimbabwe’s ambitious plans to achieve 100% household electricity access by 2030, as well as access to clean cooking, and the diversification of the country’s energy mix to include more renewable energy.
It is anticipated that, by piloting the use of bankable, standardised documentation, Vungu Solar will enable the Government of Zimbabwe to attract significant future development finance and private sector investment to grow the country’s renewable energy sector. The project expects to reach financial close and commence construction in 2026.
For more information contact:
Lorna McNae
Senior Communications Manager – InfraCo
Private Infrastructure Development Group (PIDG)
