RETRADE-SA MPA Phase 4: Zambia - Malawi Interconnector Project

pipeline

The Governments of Zambia and Malawi have, in line with the call for greater regional integration, agreed to strengthen their existing bilateral cooperation by among others, constructing the Zambia-Malawi (ZAMA) Interconnector. To this effect, an Inter-Governmental Memorandum of Understanding (IGMoU) between Zambia and Malawi was signed in August 2015 in Lusaka, Zambia. During the same time an Inter-Utility Memorandum of Understanding (IUMoU) was also signed between ZESCO and ESCOM, the two respective national power utilities. Historically Zambia and Malawi have had cross border power trade at distribution level dating back to the year 2000 in which ESCOM started supplying power to Zambian towns in the border area. This was undertaken in response to a resolution of the then SADC Council of Energy Ministers. From 2018, Malawi has also been benefiting from the cross-border power supply from Zambia through a 33kV line from Chipata to Mchinji. The ZAMA Interconnector represents a critical initiative to strengthen regional energy integration and security in the region. The Government of Republic of Zambia through a letter dated June 6, 2024 (MFNP/EMD/101/25/5) requested the World Bank assistance for the ZAMA Interconnector Project. The proposed Project is in response the request and would be designed to address persistent electricity supply challenges in both Zambia and Malawi, while also supporting broader objectives of economic growth, climate resilience, and regional cooperation within the Southern African Power Pool (SAPP).The proposed interconnection consists of a 400kV double circuit overhead transmission line, extending approximately 193 kilometres. Of this, 146 kilometres will be constructed within Malawi, connecting the Nkhoma Substation to the border, while 47 kilometres will be built in Zambia, linking the border to the Chipata West Substation. Both terminal substations will be expanded to accommodate the new interconnection, including the installation of new 400kV bays, shunt reactors, and autotransformers.The proposed Project scope for Zambia comprises: (i) a 46.6 km segment of a 400kV double-circuit overhead transmission line from the Zambia/Malawi border to the existing Chipata West 330/132/33/11kV substation, using triple-bundle ACSR “Tern” conductor on self-supporting lattice steel towers in vertical configuration, within a 50 m right-of-way; (ii) the extension of Chipata West Substation to include a new 400kV switchyard with 2 line bays, 2 line-connected shunt reactors, 2 × 600 MVA 400/330kV autotransformers, a 400kV busbar system, and a new control building; and (iii) project management and technical assistance. The feasibility study, conceptual design, as well as tender documents, Environmental and Social Management Plan, and Resettlement Action Plan, financed by Swedfund through SAPP, have been completed and reviewed by World Bank team.The rationale for the Project is compelling. Malawi is currently investing in new hydropower capacity, most notably the Mpatamanga Hydropower Storage Project (MHSP) (350MW, COB by 2030). Its financial sustainability is contingent upon securing credible off-takers to back stop ESCOM payments, structured on take-or-pay basis. The ZAMA Interconnector will enable Malawi to export surplus hydropower to Zambia, whose mining sector is experiencing significant expansion and is a cornerstone of the national economy. Zambia’s mining operations, particularly in the Southern Copperbelt, are currently constrained by severe power supply challenges, frequent outages, and grid congestion. From a regional perspective, the Interconnector will enable cross-border electricity trade, system balancing, and long-term trading mechanisms. It will also enhance the resilience of both countries to climate variability, particularly droughts that have recently affected hydropower generation in the Zambezi basin. The Project is thus aligned with the strategic objectives of SAPP and the broader development goals of both countries. Additionally, the Interconnector will provide power to the Lobito Corridor. The Corridor is a strategic transport, industrial, and trade route centered on the railway line from the Port of Lobito in Angola to the Copperbelt regions of the Democratic Republic of Congo and Zambia. The total Corridor demand over the next 5–10 years is estimated at between 850 MW and 1,350 MW.The proposed Project would constitutes Phase 4 of the Regional Energy Transmission, Trade and Decarbonization Project in Southern Africa Region (RETRADE-SA) multi-phase programmatic approach (MPA) program, approved by the World Bank’s Executive Directors on January 21, 2025, with the first phase being the Zambia–Tanzania Interconnector Project (P507033).