Contract Signed For Co-financing Of Rehabilitation Of 2 075 MW Hydroelectric Plant In Mozambique
Hidroeléctrica de Cahora Bassa (HCB) and AFD signed a EUR100M non-sovereign concessional loan agreement to contribute to the financing of the plant’s 10-year rehabilitation program, the “Capex Vital”. This program, aimed at extending the life of the plant equipment by at least 25 years, includes the refurbishment of the power plant and the electrical substation. It will improve operational reliability, reduce forced outages and maintenance costs, and restore international standard performance levels.
The loan is complemented by a EUR 22M European Union delegated grant to AFD, targeting additional components to increase the plant’s sustainability in the areas of reservoir water management, training, digitalization, and resilience of its infrastructure.
The AFD and EU financing will contribute to mitigating long-term operational risks and will help HCB maintain its position as key player and vital supplier of green energy in the region, as well as a strategic enterprise of the Mozambican economy. This new partnership between AFD and the EU in the energy sector will contribute to the implementation of the Team Europe Initiative Green Deal, officially launched in Maputo on December 6, 2022 and the EU Global Gateway Strategy.
About HCB
HCB is the concessionaire of the largest dam and power station in Mozambique, based on the Zambezi River. With an installed capacity of 2,075 MW and average annual production of around 15 TWh, HCB is the main electricity producer in Mozambique and a major player in the energy sector in southern Africa, which faces increasing demand and lack of generation capacity, especially in green energy.
About AFD
AFD Group implements France’s policy in the areas of development and international solidarity. The Group includes Agence Française de Développement (AFD), which finances the public sector and NGOs, as well as research and education in sustainable development; its subsidiary Proparco, which is dedicated to private sector financing; and Expertise France, a technical cooperation agency. The Group finances, supports and accelerates transitions towards a fairer, more resilient world.
About the EU
The European Union is an economic and political union, consisting of 27 member states that together cover most of Europe. It is one of Mozambique's largest development partners and has accredited 11 of its members in the country. Currently, the European Union has as its main instrument of cooperation in Mozambique a Multi-year Programme (2021 – 2027), with a budget of 428 million Euros for the first four years of implementation in key development areas, aligned with priorities of the Government of Mozambique, namely democracy and human rights, infrastructure and energy, education, youth and digitalization, gender issues, environment and climate, and trade and investment.
