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Support to the development of a low carbon Public Private Partnership for the generation of electricity in Mozambique

Southern Africa
Grant Amount
EUR 4,000,000
Total project cost
EUR 64,000,000
Fully disbursed
PFG Lead Financier

The global objective of the project is to support the Government of Mozambique and EDM in the implementation of a sustainable energy strategy, compliant with the total reduction of about 76.5 MtCO2eq in the period from 2020 to 2030, as indicated in the INDC of Mozambique. By encouraging the diversification of the national electricity mix, the project will also help to reduce vulnerability to climate change (droughts and their consequences on hydropower production essentially.

Developing the access and supply of electricity in the country are the upmost objectives of Electricidade de Moçambique (EDM), the State-owned Mozambican utility. It is responsible for generating, transporting, distributing and commercialising electricity in the whole country to more than 1.3 million of consumers. In line with the National Strategy for Renewable Energy 2011-2030, Mozambique and EDM are willing to develop renewable energy projects in the country to meet the fast-growing demand in poorly-supplied areas of the country and to sell energy to the neighbouring countries.

The Project will provide Technical Assistance to the Mozambican authorities at the level of EDM and the Ministry of Mineral Resources and Energy, and will help structuring adequate tools to attract private financing: design and implementation of a new PPA scheme and of the off-take risk guarantee mechanism. These tools should enable EDM to structure its participation to some of these strategic power generation projects. In this regard, it is a crucial step for EDM and Mozambique that will enable them to actually face the challenges above mentioned.