MARONDERA- Marondera Solar Farm is among the 27 solar power projects that will benefit
from the Government Implementation Agreement (GIA) that was recently announced by
Finance and Economic Development Minister Professor Mthuli Ncube.
The GIA has three major components namely Project Development Support Agreement
(PDSA), Power Purchase Agreement (PPA) and the Reserve Bank of Zimbabwe (RBZ)
Undertaking for Foreign Currency Convertibility and Transfer.
The guarantees will cushion solar power projects that have sizes ranging from 5MW to
100MW and a cumulative capacity of 998MW at a cost of $1 billion and will speed up the
Independent Power Producers (IPPs) installations.
A government implementation agreement (GIA) sets out terms on which the Government
provides incentives and assistance to the prospective partners. It also includes a project
development support agreement, a power purchase agreement, and an agreement with the
Reserve Bank of Zimbabwe (RBZ) for guaranteed payments of dividends and foreign loan
repayments to external investors and lenders.
With Zimbabwe aiming to achieve upper middle-income status by 2030, the incentives are
part of the plan as a diversified, reliable, and affordable electricity mix will be a key factor in
achieving that goal.
Zimbabwe aims to generate 1.1 GW of electricity from renewable sources by 2025, but its
volatile currency and unattractive tariffs have kept IPP investment at bay.
De Green Rhino Energy director Francis Gogwe told this publication that the GIA will be a
game changer in the country’s energy sector.
“As De Green Rhino Energy, we are very excited with this development and we would like to
applaud the Government for taking such a bold move. This is a wonderful moment for the
energy sector in Zimbabwe. We are hopeful that following the introduction of this
framework, we shall be able to contribute significantly to the national grid in terms of
electricity production.
“We have been there for several years, working on developing Rufaro Solar Farm. We have
all the approvals in place and have been tying loose ends in terms of funding. This
development has excited even our investors,” Gogwe said.
He added that a key ingredient to the successful implementation of the solar IPPs projects is
a bankable GIA with economic tariffs.
“What excites us the most is that Government has introduced a framework that
standardises Power Purchase Agreements (PPA) together with the GIA. The documents are
critical for the success of the energy sector. The PPA addresses the tariff which is a major
area in the project development process. A cost-based tariff covers all the costs.
“The GIA which has now been attached to the framework will act as a guarantee for the
project. At least, there will be a profit for the proprietors. In the event that the off-takers fail
to meet their obligations, the risk will be shouldered by the Government. In South Africa,
they have a similar process and it has been doing wonders for the country where investors
have been stampeding to invest in the energy sector,” he said.
The director of De Green Rhino Energy also revealed that they now expect to get the ball
rolling within the first quarter of this year.
He said: “We are ready to start the Marondera Solar Farm project and we have been
speaking to investors who have offered us funds to implement the project. We expect to
start any time during the first quarter of the year and we are already making arrangements
to move containers on site.
“Apart from contributing 50 mega-watts to the national grid, we will also create down-
stream and up-stream job opportunities for the people of Marondera and surrounding
areas. This economic upward trajectory that Zimbabwe is in right now will be enhanced and
Vision 2030 will be achieved.”
Other Mashonaland East solar projects that were recommended for Government support
are Equinox Energy’s 10 MW in Makaha, Mudzi district, Lueven Investments 10 MW at
Milgrove Farm, Marondera, Africa Oracle’s 25 MW at Antelope Estate in Chivhu, TD Energy-
Ecosoft’s 36 MW at Lot 3 of Stuhm Farm, Goromonzi and Zororo Energy’s 50 MW at
Randhurst Grange Estate, Melfort.
