European Investment Bank to fund EUR50m for Itezhi-Tezhi hydropower project in Zambia

The European Investment Bank (EIB) will offer €50m in financial assistance for the construction of the 120MW Itezhi-Tezhi hydropower project in Zambia.

Located on the Kafue River the project is estimated to entail a total cost of $375m.

Scope of the project includes the hydro plant at the existing Itezhi-Tezhi Dam and a 291km transmission line to Lusaka for connection to the national grid.

Jointly owned by Zambia electricity supply corporation(ZESCO) and the Tata group, the project will be developed by Itezhi-Tezhi Power Corporation, expected to completed by 2015.

Other investors for the Itezhi-Tezhi project include the French Development Agency (AFD), African Development Bank, FMO, PROPARCO, Development Bank of Southern Africa, Republic of Zambia, TATA and the Government of India.

Additionally, the EU-Africa Infrastructure Trust Fund will provide an interest rate subsidy and technical assistance grant for the project

EIB vice president Pim van Ballekom, responsible for lending to sub-Saharan Africa, stated that increased clean energy production in Zambia will lower the cost of importing electricity to the country and diminish dependence on coal-generated power.

"The European Investment Bank recognises the detrimental economic impact of power shortages in the region and is committed to supporting long-term investment in key energy infrastructure across Africa," Ballekom said.

European Union Ambassador to Zambia Gilles Hervio added, "The Itezhi-Tezhi Hydropower Project will enhance the generation capacity of electricity on the national grid, as well as increasing the reliability and quality of supply of electricity in Zambia."