Standard Chartered, a leading international banking group, has partnered with the U.S government to help ease electricity challenges in the region.
“Standard Chartered has partnered with USAID, to deliver a term loan worth USD60 million to Zambia’s Electricity Supply Corporation (ZESCO),” read the company’s statement.
It was also reported that this initiative will become one of the largest facilities that the United States Agency for International Development (USAID) has delivered within President Obama’s ‘Power Africa’ partnership since the campaign’s launch in 2013.
Obama launched Power Africa to bring together technical and legal experts, the private sector, and governments from around the world to work in partnership to increase the number of people with access to power.
The initiative is targeting 60 million more people to be connected and along the way add 30,000 megawatts into the region’s power grid.
According to the Africa Development Bank, in Sub-Saharan Africa, just one in five people have access to electricity. If current trends continue, fewer than 40 per cent of African countries will reach universal access to electricity by 2050.
The challenge with electrification requires the region to consider all alternatives. According to its website, Smart Grid, this is already taking place to an extent.
“In many parts of Africa, rural electrification is being achieved through a mixture of on-grid generation and dedicated micro-grids, including solar systems to provide low-voltage DC to satisfy basic demands for lighting (typically LED) and mobile phone recharging.”
The loan by StanChart is set to finance capital expenditure for ZESCO’s Lusaka Transmission and Distribution Rehabilitation Project (LTDRP) as well as provide bridge financing to facilitate new connections to the grid.
ZESCO’s Managing Director, Victor Mundende, said part of its strategic plan was to improve the quality of electricity and enhance connections to the national grid.
“USAID and Standard Chartered’s support has already delivered more than 15,000 new power connections. Furthermore, some of the funds provided will be used for other scheduled power system upgrades, contributing to new and existing connections to homes and businesses across the country. ZESCO remains committed to meeting its aspirations of electrifying 60 per cent of Zambia by 2030.”
Michael Yates, USAID/Zambia Mission Director says Power Africa was a broad partnership which aims to boost economic development, by providing access to electricity to homes and businesses across Africa.
“This is one of our largest commitments in Africa to date, and will enable us to meet a critical need for a quarter of a million Zambians and the economy as a whole.”
Andrew Okai, CEO of Standard Chartered Zambia, weighed in saying “this is the Bank’s second Power Africa partnership to benefit Zambia, with the first being Standard Chartered’s Private Equity investment in Zambian Energy Corporation.”