Zimbabwe - Leading Chinese industrial electrical equipment manufacturer and clean energy supplier Chint Electric has committed US$52 million as guarantee for a 100 MW solar project ear marked for Zimbabwe’s Matebeleland South province to the south west of the country.
The project whose site is near the town of Gwanda in Matebeleland South has been lying in limbo since Chint Electric and its Zimbabwean partner Intratek controversially won the tender more than three years ago.
The Gwanda Solar Project tender won by Chint Electric with its partner Intratek was one of three proposed solar projects with an expected total installed capacity of 300MW.
Despite winning the tender for the Gwanda Solar Project, Chint Electric and its partner Intratek failed to immediately start the project siting lack of funding from Chinese or Zimbabwean investors.
Chint indicated that arrears from previous Chinese government guaranteed projects had scuppered financial mobilisation and delayed the Gwanda solar project.
The US$52 million commitment by Chint seeks to unlock funding needed to develop the project and it covers 30% of the engineering, procurement and construction (EPC) aspects of the contract, which was initially quoted at US$172 million but has been revised down to US$132 million due to falling global solar equipment prices.
Zimbabwe’s power utility ZESA through its subsidiary Zimbabwe Power Company (ZPC) as the contractor will also pay 30% of EPC project costs.
Zimbabwe’s state owned daily, the Herald, reports that Chint has dedicated itself to attract as much capital for the Gwanda solar project as possible from local and international infrastructure financiers to meet the rest of the project costs.
At the same time Intratek is also concluding alternative funding for the project locally through pension funds and insurance backed infrastructure bonds.
The Herald also reports that Zimbabwe’s Finance and Economic Planning Minister Patrick Chinamasa last year granted prescribed and liquid asset status to infrastructure bonds meant to raise part of the for the solar project.
Zimbabwe whose power deficit is at least 600MW will see the Gwanda Solar project come online in phases of 26,1MW, 28,2MW, 21,7MW and 23,9MW for maximum cost benefit to ZPC.