Home
About
Market Information
Access to Finance
News
Events
© EUEI PDF
Zambia

Energy Sector

Overview

Zambia’s electricity sector is largely dependent on hydropower. As a result of erratic rains, declining water levels in Kariba Dam and increased electricity demand, the country has experienced a severe electricity supply deficit since approximately June 2015. Output for the sector is estimated at less than one third of installed capacity. Load shedding has led to increased costs of living.

 

Electricity Demand & Electrification Rates

Approximately 70% of the country’s electricity demand is driven by its mining sector, which benefits from highly subsidized electricity rates. Peak demand has been recorded at 1,960 MW. Growth in electricity demand has been estimated at between 150 MW and 200 MW per year.

Access to electricity in Zambia is estimated at 28% of the total population, comprising approximately 62% of the urban population and 5% of the rural population. Approximately 500,000 urban households and 1.8 million rural households currently do not have access to electricity. The Government of Zambia maintains an official target of achieving 51% rural electricity access by 2030.

 

Electricity consumption in 2014

Economic SectorGWh
Industry6,429
Transport31
Residential3,251
Commercial and Public Services668
Agriculture / Forestry241
Fishing0
Other non-specified99
Final Electricity Consumption10,719

 

 

Electricity generation

Zambia’s electricity mix is dominated by hydro generation. Large and mini-hydro stations account for 95% of installed capacity. Droughts caused the country’s power shortage to widen to half of peak demand, or approximately 1 GW in 2015. Approximately 4% of the country’s generation mix is provided by fossil fuels, including diesel-based mini-grids operated by ZESCO, the Ndola Energy Heavy Fuel Oil Plant (50MW), and six gas turbines (80MW) owned and operated by the Copperbelt Energy Corporation.
Zambia’s Electricity Company, ZESCO, a state-owned entity, owns the bulk of generation stations. ZESCO is a vertically integrated company, with its largest customer being the Copperbelt Energy Corporation (CEC); a privately-held company that organizes the electricity distribution to copper mines. CEC purchases more than 50% of all generated electricity on the basis of a long-standing contract with fixed prices, in addition to its own generation.
Due to currently heavily subsidized electricity tariffs, prospects for bringing new capacity online are hindered, as ZESCO is limited in its ability to sign commercially viable Power Purchase Agreements (PPAs). Despite this, the country has indicated plans to increase capacity by 2 GW in 2016 and 2017 and has indicated intentions to move to cost reflective tariffs in 2017, in line with the regional SADC targets. Several energy development opportunities are underway in hydro, geothermal, coal, and solar PV. The first coal power generation has been included in the energy mix in 2016 from the phased 300MW coal fired power project by Maamba Collieries. The IFC’s “Scaling Solar” initiative intends to support up to 300MW of solar in Zambia, in collaboration with the Zambia Industrial Development Corporation (IDC), in addition to a planned 50MW to be supported by KfW’s GetFiT programme.

 

Installed Generation Capacity (MW)

Power StationOwnerInstalled Capacity (MW)
Kafue GorgeZESCO990
Kariba North BankZESCO1,050
Itezhi-TezhiZESCO120
Victoria FallsZESCO108
LunzuaZESCO14.8
LusiwasiZESCO12
Chisimba FallsZESCO6
Musonda FallsZESCO5
Shiwa Ng’anduZESCO1
LunsemfwaLunsemfwa Hydro Power Ltd.31
MulungushiLunsemfwa Hydro Power Ltd.25
ZengaminaCharles Rea0.7
Gas Turbine (Standby)CEC80
Heavy Fuel Oil (HFO)Ndola Energy50
TOTAL2,493.5

 

 

Transmission and Distribution

The Zambian power grid is based on five voltage levels: 330 kV (2,241 km), 220 kV (571 km), 132 kV (202 km), 88 kV (734 km) and 66 kV (1,037 km). A challenge in electrification of rural areas is the very low population densities, even within villages.

 

 

 

Electricity Tariffs

Electricity tariffs in Zambia have historically been heavily subsidized, leading to a challenging commercial environment for private developers, as well as for ZESCO. Efforts to raise tariffs to cost reflective levels are ongoing, in line with the objective of the Southern African Development Community (SADC) to achieve cost reflective electricity prices by 2019, and an increase in electricity prices is expected in the short term.

 

Electricity tariff schedule effective 1 May 2017

 Maximum Demand Charge/Month (ZMW)Fixed Monthly Charge (ZMW)Energy charge/kWh (ZMW)
1. RESIDENTIAL   
Consumption up to 300kWh0.15
Consumption above 300 kWh27.350.77
2. COMMERCIAL (up to 15kVA)82.640.47
3. SOCIAL SERVICES TARIFFS   
Schools, Hospitals, Orphanages, Churches, etc.71.870.42
4. MAXIMUM DEMAND TARIFFS   
Capacity between 16 – 300kVA20.96205.230.30
Capacity between 301-2,000kVA39.20410.430.26
Capacity between 2,001-7,500kVA62.63869.610.21
Capacity 7,500 kVA – 10,000kVA62.971739.250.18

 

Electricity tariff schedule effective 1 September 2017

 Maximum Demand Charge/Month (ZMW)Fixed Monthly Charge (ZMW)Energy charge/kWh (ZMW)
1. RESIDENTIAL   
Consumption up to 300kWh0.15
Consumption above 300 kWh31.900.89
2. COMMERCIAL (up to 15kVA) 96.410.54
3. SOCIAL SERVICES TARIFFS   
Schools, Hospitals, Orphanages, Churches, etc. 83.840.49
4. MAXIMUM DEMAND TARIFFS   
Capacity between 16 – 300kVA24.45239.440.35
Capacity between 301-2,000kVA45.73478.840.30
Capacity between 2,001-7,500kVA73.061014.550.25
Capacity 7,500 kVA – 10,000kVA73.472029.130.21

Off-Grid Electrification

Off-grid electrification initiatives in Zambia are scarce but emerging. ZESCO operates several diesel-based mini-grids, with emerging public (Rural Electrification Authority – REA) and private activity in solar PV- and hydro-based mini-grids. There is at least one operational provider of Pay-As-You-Go (PAYG) household solar solutions, and solar lanterns are widely available. In 2016, SIDA launched the Beyond the Grid Fund for Zambia to accelerate off-grid market development, providing support to five existing market actors and introducing several regional market leaders to the country, in an effort to electrify one million Zambians.

 

Key figures

Available statistics:
Capital
Lusaka
Official language
English
Population (2016 est.)
15,510,711
Population growth (2016 est.), %
2.94
Median age (2016 est.), years
16.7
Urbanization rate (2010 - 2016), % p.a.
4.32
Urban population (2015), % of total
40.9
Rural population (2015), % of total
59
Population density (2015), per km2
22
HDI (2014)
139 of 188
National Currency
Kwacha, ZMW
GDP (2015), USD million current
21,154.39
GDP growth (2015), %
2.9
GDP annual growth rate forecast (2020), %
5.97
GNI per capita (2015), current int’l USD
3,640
Inflation (2016), %
7.5
Inflation Rate Forecast (2020), %
13.07
Foreign Direct Investment, net inflows (2015), BOP current USD billions
1,582
Net official development assistance (2014), current USD millions
994
Budget deficit (2016), % of GDP
-8.1
Ease of Doing Business (2016), rank of 190
98
TI Corruption Index (2016), rank of 168
76
Installed Generation Capacity (2016), MW
2,400
Installed Fossil Fuel Capacity (2016), % of total installed capacity
4
Hydro Capacity (2016), % of total installed capacity
95
Other RE Capacity (2016), % of total installed capacity
<1
Renewable electricity output as % of total electricity output excl. hydro (2016)
<1
Avg. distribution and transmission losses as % of output (2013)
9
Net electricity imports (2014), kWh
13 million
Electrification rate, total (2016) %
28
Electrification rate, urban (2016) %
62
Electrification rate, rural (2016) %
5
Peak demand (2015), MW
Nearly 3,000
Per capita electricity consumption (2013), kWh
731
Did you find this information useful? YES NO