The investment comes as Southern African countries seek new sources of power to address persistent electricity shortages, rising energy demand, and the growing impact of climate change on traditional power generation systems.

Under the proposed financing package, $40 million will be used to refinance Solarcentury Africa’s existing solar assets, including the 25 MW Mailo Solar Plant in Zambia and the 19.3 MW Gerus Solar Farm in Namibia.

Both projects are already supplying renewable electricity into the Southern African Power Pool (SAPP), the regional electricity trading network that connects power utilities across multiple countries.

A further $40 million facility has been earmarked to support future expansion projects, including the planned 113 MW Lotsane Solar Plant in Botswana, which is expected to add significant new renewable energy capacity to the regional grid.

The financing supports Solarcentury Africa’s merchant power model, which enables electricity to be sold directly into regional power markets rather than relying exclusively on long-term government-backed power purchase agreements.

The model is designed to improve the flow of electricity across borders and direct supply to areas experiencing the highest demand.

The investment arrives at a critical time for Southern Africa’s energy sector.

Several countries in the region continue to face power deficits, while climate-related disruptions have exposed vulnerabilities in electricity systems heavily dependent on hydropower.

Zambia has been among the hardest hit. The country generates most of its electricity from hydropower, but prolonged drought conditions have reduced water levels at key reservoirs, leading to lower power generation and increased pressure on the national grid.

By expanding solar generation capacity, the new investment is expected to help diversify Southern Africa’s energy mix, reduce dependence on hydropower, and improve long-term energy resilience.

FMO has classified the transaction as both a Green and Reducing Inequality investment, reflecting its environmental and development impact.

The development finance institution estimates that around 90% of the electricity generated by the immediately financed projects will be supplied to Zambia, supporting electricity access while advancing the country’s clean energy goals.

The planned financing also highlights the growing role of private investment and regional electricity markets in addressing Africa’s energy challenges.

If completed, the transaction will further strengthen Solarcentury Africa’s position as one of the region’s leading independent renewable energy developers while supporting broader efforts to improve energy security across Southern Africa.