In a country where the lights depend on the patience of distant lenders, Zambia's Minister of Electricity has moved to confront a quiet paradox: more than 16,000 megawatts of power projects hold signed contracts, yet cannot take the final step toward construction. The hesitation rests less on engineering than on trust, specifically whether the state-owned utility and other buyers can honor payments across decades of agreements. As the nation seeks to grow from 4,722 megawatts toward 10,000 by 2031, the coming meeting between government and developers will test whether promises on paper can bec
Zambia to Meet Developers Over Financing Delays Stalling 16,000MW of Signed Power Projects
Signed agreements, but no money to start building
Mark
Why are signed contracts not enough to get these projects built?
Mimi
A PPA promises a buyer, but lenders want to know the buyer will actually pay. Until they believe that, financial close doesn't happen and no construction money flows.
Mark
Who is the worry about?
Mimi
Mainly ZESCO and other buyers. The World Bank flagged ZESCO's financial pressures as a major constraint on investment.
Luke
Careful, though. The 16,000MW is proposed capacity, not capacity under construction. And the reporting doesn't say how many individual projects that covers or how many are stalled for payment reasons versus other ones.
Mark
What about the government stepping in with guarantees?
Mimi
The World Bank said in 2025 that Zambia's fiscal position limits sovereign guarantees. So other protections are needed, like the liquidity mechanism the UK-funded programme helped develop.
Luke
And that mechanism is described as proposed. There's no evidence yet that it works or has changed any lender's decision.
Mark
Banda also mentioned the investment framework. Is that a separate issue?
Mimi
Partly. He said financiers were asking for things the framework already covers, so some friction may be avoidable if developers comply before submitting PPAs for approval.
Luke
That's his account to one outlet. We don't know how widespread it is.
Mark
So what decides whether 10,000MW by 2031 is realistic?
Mimi
Getting signed deals to construction. Capacity grew from 3,777MW to 4,722MW, but the target needs more than 5,000MW more.
Il Polso
- More than 16,000MW of projects sit with signed power purchase agreements yet cannot secure the financing needed to start building.
- Lenders are wary that ZESCO and other electricity buyers may fail to meet long-term payment obligations.
- Fiscal limits prevent the government from offering sovereign guarantees, leaving private projects exposed to non-payment risk.
- The minister has called developers to a meeting, while new procurement guidelines and a proposed liquidity mechanism aim to reassure investors.
- Installed capacity must rise by over 5,000MW in five years, so converting signed deals into construction is now urgent.
In a country where the lights depend on the patience of distant lenders, Zambia's Minister of Electricity has moved to confront a quiet paradox: more than 16,000 megawatts of power projects hold signed contracts, yet cannot take the final step toward construction. The hesitation rests less on engineering than on trust, specifically whether the state-owned utility and other buyers can honor payments across decades of agreements. As the nation seeks to grow from 4,722 megawatts toward 10,000 by 2031, the coming meeting between government and developers will test whether promises on paper can become steel and concrete.
On November 9, 2026, Zambia's Minister of Electricity, Peter Kapala, visited the Energy Regulation Board and called for a meeting with power developers. The reason was a growing pile of stalled projects: proposals totaling over 16,000 megawatts, many with signed power purchase agreements, yet still without the money to begin construction. Kapala wanted to understand why these projects were struggling to reach financial close, the point where financing is finalized and funds become available.
The stakes are high. Installed capacity rose from 3,777MW in 2024 to 4,722MW by October 2026, and the government aims for 10,000MW by 2031. At the heart of the hesitation is risk, particularly whether electricity buyers, including the state utility ZESCO, can pay what they owe over long contracts. Fiscal constraints limit the government's ability to offer sovereign guarantees, so other ways of protecting investors are needed.
ERB Board Chairperson James Banda pointed to a procedural snag as well: some developers face extra demands already covered by the Ministry of Energy's investment framework. He urged compliance before PPAs are submitted, and proposed closer coordination among the ministry, the regulator and sponsors to decide which projects need government support and which can raise private finance. Steps are already underway, including a procurement framework approved in December 2025 and new guidelines published in May 2026, along with a proposed renewable energy liquidity mechanism backed by the UK-funded Green Cities, Infrastructure and Energy Programme to cushion short-term payment shortfalls. Mining, Zambia's largest power consumer, will shape how much demand these projects must serve. The upcoming meeting is the next step to watch.
On November 9, 2026, Zambia's Minister of Electricity, Peter Kapala, visited the Energy Regulation Board and called for a meeting with power developers. His reason was a pile-up of stalled projects: proposals totaling more than 16,000 megawatts, many of them backed by signed power purchase agreements, but without the money to start building.
Kapala said the government wanted to understand why projects holding signed PPAs were struggling to reach financial close. That is the stage at which financing agreements are finalized and funds become available for construction. ERB Board Chairperson James Banda said projects with PPAs account for more than 16,000MW of proposed capacity, and that securing financing remained a major obstacle to getting them built.
The delays matter because of the scale of what Zambia is trying to do. According to the Ministry of Energy, installed generation capacity rose from 3,777MW in 2024 to 4,722MW in October 2026. The government wants to reach 10,000MW by 2031, which means adding more than 5,000MW over the next five years.
The core problem is risk, particularly whether electricity buyers can pay what they owe under long-term contracts. The International Energy Agency has listed payment risks, exchange-rate fluctuations and transmission constraints among the barriers to renewable energy investment in Zambia. For lenders, the central question is whether buyers can honor their PPA payment obligations.
The World Bank has pointed to financial pressures at state-owned utility ZESCO as a major constraint on investment. In a 2025 analysis, it said Zambia's fiscal position limited the government's ability to offer sovereign guarantees for private power projects. That raises the need for other arrangements to protect investors against non-payment.
Banda also described a more procedural snag. Speaking to the Zambian Observer, he said some developers faced extra difficulty because financiers were asking for requirements already covered by the Ministry of Energy's investment framework. He urged developers to comply with that framework before submitting PPAs for regulatory approval. He also proposed closer coordination among the ministry, the ERB and project sponsors to work out which projects need government support and which can raise private financing on their own.
The government has already taken some steps. A coordinated procurement framework was approved in December 2025, and new procurement, investment incentive and financing guidelines were published in May 2026. The UK-funded Green Cities, Infrastructure and Energy Programme has also backed a renewable energy liquidity mechanism. It is meant to shield projects from short-term payment difficulties faced by electricity buyers, and to give developers and lenders more confidence that PPA payments will be maintained. The mechanism is described as proposed.
Mining, Zambia's largest electricity consumer, sits at the center of the stakes. The World Bank's analysis of national energy plans projects further demand growth as mining operations and other industrial activity expand. Whether the government can move projects from signed agreements to construction will be an important factor in reaching 10,000MW by 2031. The meeting Kapala has called is the next step to watch.
Citazioni salienti
Projects with PPAs represent more than 16,000MW of proposed capacity, but securing financing remains a major obstacle.— James Banda, ERB Board Chairperson (paraphrased)
The government wants to understand why projects with signed PPAs are struggling to reach financial close.— Peter Kapala, Minister of Electricity (paraphrased)
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