Serengeti Energy, in partnership with Zambian firm Kwama Energy, has reached financial close on the Ilute Solar PV Project, marking a significant milestone in Zambia’s renewable energy transition. The project has secured full funding for the construction of a 32 MWp solar power plant near Sesheke in Western Province, allowing construction activities to commence. The financial close follows the successful arrangement of a debt package by Camco, supported by a consortium of international lenders.
What distinguishes the Ilute Solar Project is its innovative commercial structure. Unlike many renewable energy projects in sub-Saharan Africa that depend on government guarantees or long-term commitments from state-owned utilities, Ilute operates under a merchant power model. Electricity generated by the plant will be sold to GreenCo Power Services Ltd, a regional power aggregator that trades electricity across the Southern African Power Pool. This model highlights a growing shift toward market-based and private-sector-led solutions for renewable energy development in the region.
The project is backed by a senior debt facility totaling US$26.5 million. Dutch development bank FMO led the financing, alongside support from the Sustainable Energy Fund for Africa managed by the African Development Bank, Triodos Investment Management, and the EU-funded ElectriFI initiative. Through the use of blended finance, the project has been able to mitigate investment risks commonly associated with emerging markets, enabling progress without adding pressure to Zambia’s public finances.
The Ilute Solar Plant represents an important step in diversifying Zambia’s energy mix, which has historically relied heavily on hydropower. Recurrent droughts and climate-related water shortages have exposed vulnerabilities in hydro-dependent systems, increasing the need for resilient alternatives such as solar energy. Beyond power generation, the project incorporates a strong community development component, with one percent of annual revenues allocated to a local development trust to support long-term socio-economic benefits for surrounding communities.
As construction advances, the Ilute Solar Project is expected to serve as a benchmark for privately financed, market-driven renewable energy projects in Zambia and across Southern Africa, reinforcing confidence in alternative energy investment models.
