BMI View: A high focus on increasing hydropower capacity means that the Zambian power sector will remain vulnerable to power cuts during periods of lower rainfall or droughts. Current efforts to diversify the power sector through thermal and renewable power investments will not be sufficient to make up for a shortfall in hydropower generation. Some stability in the sector will come from the full commissioning of the Maamba coal-fired power plant in 2017.
|e/f = BMI estimate/forecast. Source: EIA, UN Data, BMI|
|Generation, Total, TWh||11.250||9.210||11.230||11.410||11.520||14.930||15.030|
|Consumption, Net Consumption, TWh||9.5||10.0||10.6||11.1||11.6||11.8||12.0|
|Capacity, Net, MW||1,890.0||2,224.4||2,374.4||2,374.8||2,376.1||3,127.9||3,129.9|
Latest Updates And Structural Trends
We are maintaining our hydropower forecasts made in the last quarter. We expect that hydropower will remain Zambia's dominant source of electricity generation, producing more than 80% of total electricity output over our 10-year forecast period.
The Zambia River Authority (ZRA) has stated that it will undergo a market sounding for the planned Batoka Gorge hydropower project. The ZRA will try to gauge investor interest in the USD4bn project before feasibility studies will be completed and a tender extended for the project.
The first 150 megawatts (MW) of the 300MW Maamba coal-fired power plant was commissioned in August 2016. We have amended our forecasts to incorporate the first two units of the power plant coming online before 2017. We forecast that units 3 and 4 will come online in 2017.
Standard Chartered Bank and the United States Agency for International Development (USAID) have partnered to provide a USD60mn loan to the Zambia Electricity Supply Corporation (Zesco) to finance expenditure for the rehabilitation of Lusaka's transmission and distribution network.
The first phase of a project to connect Tanzania to the Southern African Power Pool (SAPP) is underway, which will be done via Zambia. The project is called the Backbone Interconnector Project.
We note that the Zambian government is aiming to increase its renewables capacity through solar projects. With the latest tender, up to 73MW capacity of solar power contracts has been awarded. With the increase in renewables investment in Zambia, we will be including a renewables forecast piece with our reports from next quarter.
The Zambia Power Report features BMI Research's market assessment and independent forecasts covering electricity generation (coal, gas, oil, nuclear, hydro and non-hydro renewables), electricity consumption, trade, transmission and distribution losses and electricity generating capacity.
The Zambia Power Report also analyses the impact of regulatory changes, recent developments and the background macroeconomic outlook and features competitive landscapes comparing national and multinational operators by sales, market share, investments, projects, partners and expansion strategies.
- Use BMI's independent industry forecasts for Zambia to test other views - a key input for successful budgeting and strategic planning in the power market.
- Target business opportunities and risks Zambia's power sector through our reviews of latest power industry trends, regulatory changes, and major deals, projects and investments in Zambia.
- Assess the activities, strategy and market position of your competitors, partners and clients via our Competitive Landscape analysis.
BMI Industry View
Summary of BMI’s key industry forecasts, views and trend analysis, covering power markets, regulatory changes, major investments, projects and company developments.
Industry SWOT Analysis
Analysis of the major Strengths, Weaknesses, Opportunities and Threats within the power sector and within the broader political, economic and business environment.
BMI’s Power Forecast Scenario
Forecasts to end-2024 for all key indicators, supported by explicit assumptions, plus analysis of key downside risks to the main forecasts:
- Generation: Electricity generation total, thermal, coal, natural gas, oil, nuclear, hydropower, hydro-electric pumped storage and non-hydropower renewables.
- Transmission and Distribution Losses: Electric power transmission and distribution losses.
- Trade: Total imports and exports.
- Electricity Consumption: Net consumption.
- Electricity Capacity: Capacity net, conventional thermal, nuclear, hydropower and non-hydroelectric renewables.
BMI’s Power Risk Reward Index
BMI’s Risk Reward Indices provide investors (power companies, service companies and equity investors) looking for opportunities in the region with a clear country-comparative assessment of a market’s risks and potential rewards. Each of the country markets are scored using a sophisticated model that includes more than 40 industry, economic and demographic data points to provide indices of highest to lowest appeal to investors,
Structure, size and value of the industry sector; overview of the industry landscape and key players; an assessment of the business operating environment, sustainable energy policies, pricing and the latest regulatory developments.
Key Projects Database
Details and analysis of all current and planned developments (new ventures, capacity expansion and other investments) across the sector broken down by location, sector type, capacity, value, companies and operational status.
Illustration of the power industry that exploits our data-rich, in-depth analysis of the leading players in the sector and examination of operational results, strategic goals, market position and the potential for investment.
Power Outlook long-Term Forecasts
Regional long-term power forecasts covering electricity generation, consumption and capacity for thermal, hydroelectric and nuclear power. These are supported by a country specific overview, alongside an analysis of key downside risks to the main forecasts.
Providing BMI’s near-term economic outlook for the region as a whole, as well as taking a close look at countries of particular interest and the latest trends and developments.
The Power Market Reports draw on an extensive network of primary sources, such as multilateral organisations, government departments, industry associations, chambers and company reports, including Energy Information Administration (EIA), World Bank (WB) and United Nations (UN).