The National Pension Scheme Authority (NAPSA) is financing half of the Maamba Collieries Limited (MCL) 300MW coal-fired power project via a US$200 million debt instrument, NAPSA board chairperson Shipangu Muteto has confirmed.
Speaking in Lusaka today, Muteto said the financing agreement between MCL and NAPSA secures half the financing required. The debt balance of US$100 million is being funded by other local investors, while US$100 to complete the investment ticket will be financed through equity.
“NAPSA’s investment in this regard will be through the provision of debt to Maamba and the financing agreement that was signed was for US$200 million. The return on our investment will be at 9% net of tax (and this is dollar denominated debt) for the period of 10-and-half years,” Muteto explained.
He said the tenure includes a two-and-a-half year waiting period in principal repayments and that NAPSA would see a return of over US$300 million over the life of the loan.
The Maamba expansion project becomes NAPSA’s second investment in power generation after the successful completion of the 750MW Kafue Gorge Lower Hydro Power Plant in which the Authority invested US$119 million.
Muteto said NAPSA is committed to diversifying its portfolio and at the same time respond to reducing the current power deficit, which has seen extended hours of daily load shedding across industrial and domestic consumers.
Maamba will add 300MW to the grid and increase the much-needed energy mix diversification for a country heavily reliant on hydropower generation, which has lately been hit hard by climate change effects.
NAPSA Director General Muyangwa Muyangwa disclosed that the Authority is evaluating renewable energy proposals, especially in solar, to help mitigate the power deficit.
Muyangwa said so far, NAPSA had received 44 proposals, out of which 13 are earmarked for phased implementation before the end of this year.
He disclosed that NAPSA’s investment portfolio has grown from K9.9 billion in 2014 to K73.7 billion in the first quarter of 2024. The Authority has lately become active in investing in big ticket local infrastructure development projects, including the Lusaka-Ndola dual carriageway.
The 300MW Maamba expansion project is expected to be constructed within 24 months, beginning in August this year. It is expected that 1,200 jobs will be created during construction and 400 direct jobs when the plant is operational.
