Zambia’s Ilute Solar Project Secures Funding, Paving The Way For Market-Driven Renewable Expansion

Serengeti Energy, together with its Zambian partner Kwama Energy, has reached financial close on the Ilute Solar PV project, marking a major development in Zambia’s renewable energy sector. The project has secured the necessary funding to begin construction of a 32 MWp solar power plant near Sesheke in the Western Province. This achievement follows a successful debt deal arranged by Camco and a group of international lenders.

What sets the Ilute project apart is its unique commercial structure. Instead of relying on government guarantees or direct commitments from national utilities—common features in sub-Saharan African energy projects—the project operates on a merchant power model. The power generated will be sold to GreenCo Power Services Ltd, a regional energy aggregator, which will then trade the electricity within the Southern African Power Pool. This approach shows a growing shift toward market-based solutions for renewable energy development in the region.

To finance the project, a total senior debt package of $26.5 million has been arranged. Dutch development bank FMO led the financing, with support from the Sustainable Energy Fund for Africa managed by the African Development Bank, Triodos Investment Management, and the EU-funded ElectriFI initiative. The use of blended finance has helped reduce the risks typically associated with private-sector renewable energy investments in emerging markets, allowing the project to proceed without burdening Zambia’s public finances.

The Ilute solar plant is an important addition to Zambia’s energy portfolio, which has long depended on hydropower. With climate change and recurring droughts affecting water levels, the shift toward solar energy offers greater stability and resilience. Beyond energy supply, the project includes a strong community component. One percent of annual revenue will be directed toward a local development trust, ensuring lasting benefits for the surrounding communities. As construction moves forward, the Ilute project is expected to become a model for similar private-led renewable energy initiatives across Southern Africa.