President Lungu inaugurates two sites to accommodate the 100 mega watts solar project

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Saturday, 7th may, 2016

  • members of the patriotic front central committee present;
    • hon. Cabinet and deputy ministers present;
    • the secretary to the cabinet;
    • members of the industrial development corporation board and the chief executive;
    • senior government officials;
    • members of the diplomatic community present;
    • his excellency the ambassador of the united states of america, mr. Eric schultz;
    • the world bank country representative;
    • representatives of the international finance corporation;
    • representatives of development and donor agencies;
    • all bidders and their representatives present;
    • representatives from statutory and other government agencies present;
    • members of the press
    • distinguished guests, ladies and gentlemen.

I am happy to grace this important day, to inaugurate the sites to facilitate the implementation of the zambia scaling solar project. On behalf of my government, i would like to thank you all that have participated in making the zambia scaling solar initiative a reality.

I particularly wish to thank the international finance corporation, the world bank group and the united states government, through the obama power africa initiative, for complementing our efforts to diversify the national energy mix by promoting development of renewable energy.

Today’s event is indeed an illustration of the progress my government, in collaboration with our cooperating partners, are making in addressing the severe energy deficit in zambia that has arisen mainly on account of low water levels for hydro power generation.

Let me assure you all that my government remains committed to working closely with various stakeholders and cooperating partners in achieving long-term development in the energy sector.

Distinguished guests, ladies and gentlemen;

As we all know, energy is the lifeline of any modern economy, and as such, our country’s future economic prospects are closely tied to the development of this very important sector. It is, therefore, regrettable that the current power deficit has negatively affected productivity levels, job creation efforts and indeed government revenue.

It is for this reason that i am very pleased to be here today as testimony of the pf government’s continued efforts to move our country forward decisively by adopting innovative approaches aimed at increasing renewable energy generation and access. With over 300 days of sunshine per year, zambia has great potential to raise the rate of investment in untapped solar energy, which will not only enable our country become an electricity exporter, but will also replace the need to import expensive emergency power.

In my inugural address to parliament last september, i made a bold pledge that my administration would rapidly transition from the current power deficit to surplus and make zambia a net exporter of energy within 18 months. I am happy to annoiunce that we are on course to fulfil this promise. We can be trusted. We have a record of making good what we promise. The pf government does not shrink in the face of challenge. We have confronted every difficult situation we have faced in the past year with dignified resolve to regain the necessary stability required to re-ignite growth.

This is why this is a proud moment for us in government and the idc in particular because when we say we have embarked on a credible diversification programme across various sectors, we mean just that.

If there is one area where diversification is so urgent, it is in the energy sector. This project is a practical demonstration of our resolve to create a diversified energy sector. The difficult realities of climate change has taught us over-reliance on hydro-power won’t just do. I am here to promise that we shall continue to walk the talk in every way possible.

Those who constatly wait upon adverse natural circumstances to occur so they can exploit cheap political gain are mistaken! We are prepared and we are moving in all ways possible to ready ourselves for every situation.

Solar, wind, thermal, and geo-thermal sources will be part of zambia’s energy mix, and going forward, we will examine the nuclear option as part of efforts to ensure we are energy-secure.

Currently, government is compelled to import electricity at a huge cost, money which would have been utilised to a greater extent, to improve the living standards of our people. However, with such efforts, we are assured of self-sufficiency in electricity generation and supply.

Renewable solar energy offers a viable alternative for the country to diversify generation beyond hydro power which is vulnerable to climate change, as evidenced by the current generation deficit caused by low water levels. Solar energy is also a source of new clean electricity that will improve the standard of living of our people and support environmental sustainability.

Distinguished guests, ladies and gentlemen;

You will recall that in july 2015, i directed the industrial development corporation (idc) to target the immediate development and procurement of up to 600 megawatts of solar power into the national grid as a matter of urgency and priority. I am now pleased to inform you that, with support from our partners, work on this directive has begun, hence our presence here today.

Zambia will be the first country in africa to implement the world bank group’s scaling solar programme which enables the rapid development of privately owned, utility scale solar pv projects in sub-saharan africa.

The industrial development corporation working jointly with the international finance corporation, commenced the preliminary project development work on two solar pv plants of 50 megawatts each under round 1 representing 100 megawatts out of the targeted 600 megawatts of the estimated us$ 1.2 billion zambia scaling solar programme.

As part of the preliminary project development work, the industrial development corporation identified and secured land for two projects here at the lusaka south multi facility economic zone. In addition, the power purchase agreements except for tariff and government support agreement, which includes a world bank partial risk guarantee, and removes the need for a sovereign guarantee, have been finalised.
Geo-technical data on the environmental clearance, investment endorsement by the energy regulation board and the zambia development agency investment certification have also been finalised.

Distinguished guests, ladies and gentlemen;

The zambia scaling solar initiative has streamlined the development of grid scale solar pv power projects in zambia by introducing a transparent, open and competitive procurement process for selecting the independent power producers.

The key advantage of this solar programme is that it allows government entities to procure solar power from the private sector at the lowest possible cost in tariff terms, which ultimately benefits the economy as a whole.

Furthermore, the government is not required to support the procurement and development of large scale solar pv power into the national grid through provision of a sovereign guarantee, as the world bank has already confirmed its support for the initial 300 megawatts via a partial risk guarantee facility. This is the first time this facility is being applied to improve bankability of projects in zambia.

The development of renewable electricity sources will accelerate economic development, contribute to increasing our country’s export base and create employment during project construction, operation and maintenance of the proposed 600 megawatts solar power plants.

Distinguished guests, ladies and gentlemen;

Round 1 of the scaling solar programme, has attracted the interest and participation of major players and leading solar energy companies in the world.

The process is now well advanced with bidders having submitted final bids. The winning bidders will be responsible for financing, construction, operation and maintenance of their respective plants under 25-year power purchase agreements here at these two sites.

Following the work so far done, it is my pleasure to formally announce that round 2 of the zambia scaling solar programme targeting a further development of 200 megawatts of solar pv project, divided into four projects, should now commence.

Government will through the industrial development corporation, own a minimum of 20 percent shareholding in each of these projects which, in line with my government’s policy of citizens’ empowerment, will be offered to the zambian public through an initial public offer on the lusaka stock exchange, as a preferential offer restricted to citizens.
Distinguished guests, ladies and gentlemen;

I wish to conclude by announcing that my government has made a lot of progress in the implementation of the industrialisation and job creation strategy here at the 2,100 hectare lusaka south multi facility economic zone. However, there is still work to be done, and it is hoped that once this zone is fully operational, it will accommodate over 400 export and domestic oriented businesses and create at least 100,000 job opportunities especially for the youth and women.

It is now my singular honour and privilaege to officially inaugurate the commencement of construction works on zambia’s first-ever utility scale solar power station plants which should be commissioned before the end of this year, 2016.

I thank you and may god bless you.

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