Zambia and Zimbabwe commit USD 440 million to Batoka Gorge hydropower project, amid worsening power shortages.
Zambia and Zimbabwe pledge USD 440 million for hydropower project; power deals + regulatory updates and events to look out for.
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Zambia and Zimbabwe are currently experiencing their worst run of electricity crisis in decades. Prolonged drought across the Zambezi basin in 2024 and 2025 have significantly reduced inflows to the Kariba Dam, forcing the Zambezi River Authority (ZRA) to curtail generation in order to preserve reservoir levels. Given Kariba’s central role in both countries’ power systems, the resulting outages have exposed the structural vulnerability created by high hydro concentration and limited dispatchable alternatives.
Within this context, the decision by Zimbabwe and Zambia to commit USD 440 million (USD 220 million each) toward restarting development of the Batoka Gorge Hydropower Project represents a recalibration of long-term supply planning rather than a near-term solution. Understanding what this commitment represents requires a closer look at Batoka itself, its history, and the assumptions embedded in its revival.
The Batoka Gorge Hydropower Project
Batoka is a 2,400 MW project on the Zambezi River, equally allocated between the two countries, with expected average annual generation of approximately 10,215 GWh. Batoka has an extended development history. Progress has been repeatedly interrupted by financing constraints, procurement disputes, environmental concerns related to the Batoka Gorge ecosystem, and broader macroeconomic shocks, including the COVID-19 pandemic.
The project’s renewed momentum comes at a moment when drought has already exposed the limits of hydro-dependent power systems across the Zambezi basin. This raises a critical question for planners and investors alike: whether additional large-scale hydro capacity on the same river system mitigates system risk or simply reallocates it.
Batoka’s location does not insulate it from basin-wide drought risk
Batoka Gorge is located on the Zambezi River downstream of Kariba and therefore shares exposure to the same basin-level hydrological variability. The prolonged drought that reduced inflows into Kariba was not a site-specific event but a system-wide shock affecting much of the river’s catchment. As a result, Batoka should not be viewed as a hedge against drought in the Zambezi basin, but as an additional generating asset operating within it.
Hydrological conditions have stabilised, but system stress remains
According to the ZRA, Rainfall patterns in parts of the Zambezi basin improved toward the end of 2025, easing immediate pressure on inflows. However, recovery in reservoir levels following deep drawdowns is typically slow, and system operators have continued to prioritise water conservation over maximising short-term generation.
Why Batoka still features in long-term planning despite shared hydrology
The USD 440 million commitment is not sufficient to reach financial close on a project with an estimated total cost of approximately USD 4.5 billion. It does, however, mark a shift from prolonged preparation toward capital mobilisation after several years of inactivity. From a system-planning perspective, Batoka remains central to long-term planning in Zambia and Zimbabwe because it reduces reliance on a single reservoir-backed generation asset.
Batoka’s revival therefore reflects a shift in how both countries are approaching long-term capacity risk under increasingly volatile hydrological conditions, rather than an attempt to resolve the current electricity crisis. The project’s trajectory will be determined less by the initial commitment than by whether financing, governance, and execution can be aligned at scale. In systems already stressed by climate variability, the difference between ambition and impact will be measured in delivery.
Batoka is one of several large-scale projects currently at a preparatory inflection point. EI’s Project Pipeline and Investment & Deal Flow reports for November, track comparable cases across African power markets, allowing readers to assess how often early commitments translate into construction and operation. You can access the reports here.
Deals and Investments
Madagascar: Afripower has begun construction of a 40 MW solar PV plant to operate alongside the Mandroseza heavy fuel oil power station, with a first phase delivering about 15 MWp to the grid by early 2026 and the remaining capacity to follow in later phases. Solarquarter
Mozambique: United Kingdom Supports Mozambique with $500,000 for Technical Assistance to the Mphanda Nkuwa Project Water Power
Nigeria: Femi Otedola sold his 77 per cent controlling stake in Nigeria’s Geregu Power Plc in a $750 million deal to MA’AM Energy Limited, which became the new controlling shareholder of the major power generation company. Premium Times
Nigeria: Transgrid Enerco Limited completed its acquisition of a 60% controlling stake in Eko Electricity Distribution Company in a deal valued at approximately N360 billion. Naira. The Guardian
Nigeria: BlueCore InfraCo Limited completed the acquisition of Axxela Limited using a US$285 million financing package arranged by Rand Merchant Bank, enabling Helios Investment Partners and Sojitz to exit the gas infrastructure company. RMB
Regulatory and Policy Updates
Angola: has opened a public consultation on a proposed biofuels law aimed at creating a legal framework to support biofuel production, blending, and investment in the country’s energy transition. ANPG
What we’re watching
Libya Energy & Economic Summit (LEES): 24-26 January 2026 in Tripoli, Libya. An annual forum bringing together government, industry, and investors to advance investment and strategic development across Libya’s oil, gas, power, and renewables sectors. LEES
World Future Energy Summit: 13-15 January 2026 in Abu Dhabi. An annual international platform in Abu Dhabi convening policymakers, industry leaders, investors, and innovators to accelerate the global transition to clean energy and showcase emerging technologies. World Future Energy Summit
Global Summit on Renewable Energy, Climate Change and Global Warming 2026: 22 January 2026 in Port Elizabeth, South Africa. An international conference bringing together industry experts, academics, and researchers to address renewable energy, climate change impacts, and sustainable solutions. Africa Energy Portal