Assessing the Financial Viability of Utility-Scale Solar Power Investment in Zambia: Evidence from Copperbelt Energy Corporation

Lushomo Chiyongwe and L. Haabazoka
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Lushomo Chiyongwe: University of Zambia
L. Haabazoka: University of Zambia

African Journal of Commercial Studies, 2026, vol. 7, issue 3

Abstract: This study evaluates the financial viability of utility-scale solar power investment in Zambia, with specific reference to Copperbelt Energy Corporation (CEC). It examines the performance of the 34MW Riverside Solar Power Plant and the ongoing 60MW Itimpi Phase 1 solar project, addressing a gap in firm-level empirical evidence on renewable energy investments in Sub-Saharan Africa. Guided by the Resource-Based View and Capital Budgeting Theory, the study analyzes return profiles, generation capacity, and financial break-even dynamics. A mixed-methods single-case study design was adopted. Findings indicate significant growth in renewable energy capacity, with solar installations reaching 94 MW in 2024 and generation rising to 153.8 GWh. Financial performance improved markedly, with solar revenue increasing from USD 2.54 million in 2023 to USD 8.66 million in 2024, and net profit rising from USD 0.22 million to USD 1.08 million. Although initial capital costs were not fully recovered within the study period, forward-looking projections demonstrate medium-term viability, with an estimated Internal Rate of Return (IRR) of 12.0%, Net Present Value (NPV) of USD 16.60 million at a 10% discount rate, and a payback period of approximately 7.9 years from January 2024. The study concludes that CEC’s solar investment is operationally sound, strategically significant, and commercially viable over the project lifecycle. It contributes to the literature by demonstrating that early-stage renewable investments can achieve long-term financial sustainability despite initial recovery constraints.

Keywords: Solar Investment; Financial Viability; Renewable Energy; Copperbelt Energy Corporation; Capital Budgeting (search for similar items in EconPapers)
JEL-codes: G31 O13 Q42 (search for similar items in EconPapers)
Date: 2026
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Persistent link: https://EconPapers.repec.org/RePEc:cwk:ajocsk:2026-80

DOI: 10.59413/ajocs/v7.i3.9

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