Zambia is attracting fresh private capital into its electricity sector, with global energy and commodities group Mercuria and Africa-focused energy investor Exergy signing a US$250 million financing agreement to support power generation and transmission projects.
The deal, signed in Lusaka, represents one of the largest private capital commitments to Zambia’s power sector and marks Mercuria’s entry into the regional electricity market. The financing will support projects being developed by Exergy subsidiaries Lunzua Power Company and Lusitu Transmission and Distribution Company, subject to regulatory approvals.
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The investment comes as Zambia seeks to expand electricity supply to support economic activity across mining, agriculture, manufacturing, tourism and other industries.
Exergy said its project pipeline is expected to contribute to Zambia’s target of reaching 10,000MW of power supply by 2031, while supporting wider efforts to strengthen the country’s electricity infrastructure.
The agreement also has a regional dimension.
Zambia sits at an important geographical position in Southern Africa, bordering eight countries and operating within the Southern African Power Pool. Exergy is developing projects that could strengthen connections between Zambia and neighbouring power markets, including planned transmission links towards East Africa.
That creates an opportunity for Zambia to develop not only as a producer of electricity but also as a potential regional power-trading hub.
The importance of additional generation and transmission capacity is particularly clear as African economies seek to industrialise. Manufacturing plants, mines, farms, data centres and digital businesses all require dependable electricity. Weak or unreliable power supply can raise operating costs and limit investment.
Private capital can therefore complement public investment and development-finance institutions by bringing additional financing and commercial expertise into strategic infrastructure.
The Mercuria-Exergy agreement reflects that changing investment landscape. Mercuria said its commitment is intended to combine its global market knowledge, trading capabilities and relationships with Exergy’s regional energy-development expertise.
The deal also follows reforms in Zambia’s electricity market, including measures supporting greater private-sector participation and open access.
For Zambia, the immediate priority will be turning the financing commitment into completed generation and transmission infrastructure. For the wider region, the opportunity is even broader: stronger electricity networks can support cross-border trade and help countries make better use of available generation capacity.
The investment comes at a time when Africa is seeking to mobilise much larger volumes of private capital for infrastructure. Initiatives such as Mission 300, led by the World Bank and African Development Bank, aim to expand electricity access to hundreds of millions of Africans by 2030.
Zambia’s latest agreement shows how private investment can become part of that wider transformation.
If successfully implemented, the projects could strengthen domestic electricity supply, support industrial growth and deepen regional power integration.
For an economy seeking to turn its natural and industrial potential into sustained growth, reliable power is not simply an infrastructure requirement. It is a foundation for investment, productivity and long-term economic transformation.
