What CEC’s $150m Green Bond means for Zambia’s economy

By BUUMBA CHIMBULU

AMID Zambia’s worst energy crisis in decades, the Copperbelt Energy Corporation (CEC) achieved a milestone that has placed the country on the global map of sustainable finance.
In December 2024, the company successfully issued a US$150 million, 15-year green bond to finance the development of a combined 230 megawatts (MW) of solar energy projects, a first of its kind not just in Zambia, but across Africa’s energy sector.
This is under the existing US$200 million Medium-Term Note Programme (MTNP).
The issuance marks a bold step in CEC’s mission to diversify Zambia’s power supply by scaling up renewable energy and reducing dependence on hydropower, which currently provides more than 80 percent of the country’s electricity but is increasingly vulnerable to recurring droughts.
The severe power shortages of 2024, which triggered nationwide load shedding and disrupted mining and manufacturing operations, underscored the urgency of shifting towards a more resilient energy mix.
“The energy crisis the country has faced has been a wake-up call for all stakeholders in the power sector,” said CEC Managing Director Owen Silavwe. “It is imperative to accelerate the development of sustainable solutions to achieve national energy security.”
The green bond, registered with the Securities and Exchange Commission (SEC) and listed on the Lusaka Securities Exchange (LuSE), represents a financial innovation that opens new channels for long-term, private-sector-led infrastructure financing.
Structured in two tranches — US$53.5 million and US$96.7 million — the bond was met with overwhelming investor interest.
According to Verona Mwila Nkolola, CEC’s Head of Corporate Communications and Investor Relations, the first tranche was oversubscribed by 178 percent, and the second by 230 percent, attracting investors from both local and international markets.
“This overwhelming response reflects the growing confidence in green bonds as a viable financing tool for green projects and in the company’s strategy,” Ms Nkolola said.
The green bond’s success was achieved through collaboration with a consortium of local and international partners, including Cygnum Capital, Stanbic Bank Zambia, Moira Mukuka Legal Practitioners, Bowmans, Trinity International, and oversight from LuSE and the SEC.
Its global recognition came swiftly: the bond was named “Bond of the Year” at the IJGlobal Awards 2024, an international accolade that placed Zambia among countries pioneering climate-aligned financial innovation.
Zambia’s recent power crisis, driven by low water levels in reservoirs such as Kariba and Kafue Gorge, exposed the fragility of its hydropower-dependent energy system. Industries, particularly in the Copperbelt, were forced to scale back operations, with ripple effects on exports, employment, and government revenues.
CEC’s entry into large-scale solar energy signals a strategic pivot. By financing 230MW of solar capacity, the company aims not only to stabilise its own power supply but also to support national grid reliability, helping the country transition from energy deficit to self-sufficiency.
The company’s renewable strategy complements government efforts to expand generation capacity under Zambia’s Renewable Energy Investment Plan, which targets increased private sector participation in clean energy projects.
Beyond its immediate impact on the energy sector, the CEC green bond represents a vote of confidence in Zambia’s financial markets.
It positions the country as an emerging hub for Environmental, Social, and Governance (ESG)-driven investment, a trend increasingly shaping global capital flows.
SEC Director for Market Supervision and Development Nonde Sichilima described the bond’s registration as “a positive development for our capital markets,” adding that it is expected to catalyse future green bond issuances and “contribute towards deepening capital formation in the country.”
Green bonds are designed to raise funds for environmentally beneficial projects, from renewable energy to sustainable agriculture and clean transport, while offering investors measurable impact and returns.
For Zambia, this provides a critical avenue for attracting foreign direct investment (FDI) and reducing dependence on concessional loans or donor funding.
Experts say the successful issuance has enhanced Zambia’s credibility with international financiers, signalling its readiness to participate in global climate finance mechanisms, including carbon markets.
If well managed, such instruments could open up new revenue streams through carbon credits and further incentivise low-carbon development.
Reliable power is a foundation of economic growth. By securing long-term private financing for renewable projects, Zambia is reducing fiscal pressure on government while encouraging private-sector-led development in critical infrastructure.
The CEC bond’s structure, long-term and fixed-rate, also helps mitigate exchange rate and refinancing risks that often deter investment in frontier markets.
This model could pave the way for other companies and even government entities to issue thematic bonds, including social, sustainability, or infrastructure bonds, expanding Zambia’s access to diversified funding.
The green bond will also have tangible employment and social impacts. Construction, engineering, and operations within the solar projects will generate local jobs, promote technology transfer, and build technical capacity in renewable energy management.
As solar energy scales up, it could reduce electricity costs, enhance industrial competitiveness, and even stimulate local manufacturing of solar components.
Economists argue that renewable energy growth could become a cornerstone of Zambia’s economic diversification agenda, reducing the economy’s overreliance on copper mining and enabling new industries — such as electric mobility, agri-processing, and digital services — to thrive.
CEC’s achievements have not gone unnoticed at home. At the inaugural Zambia Capital Markets Conference & Awards held in Livingstone earlier this year, the company was the standout winner, scooping nine awards, including recognition for its US$200 million green bond placement and overall contribution to deepening local capital markets.
The two-day conference, hosted at the Avani Hotel, brought together listed companies, brokers, regulators, and investors to discuss the evolving landscape of the LuSE and the future of sustainable finance in Zambia.
CEC’s success story underscored how innovation in corporate finance can align with national development priorities — particularly at a time when the country is seeking to strengthen investor confidence and mobilise domestic resources for growth.
For CEC, the green bond is more than a corporate financing exercise, it is a statement of intent and a blueprint for Zambia’s energy future.
By expanding solar capacity, the company is directly addressing the twin challenges of energy insecurity and climate vulnerability.
In the long term, a stronger renewable energy base could help Zambia lower electricity tariffs, boost export competitiveness, and enhance its attractiveness to ESG-focused investors from Europe, Asia, and the United States.
As global capital increasingly rewards sustainability and resilience, Zambia’s entry into green finance signals a broader economic shift — from short-term crisis management to long-term climate-smart growth.
The CEC green bond, therefore, stands not just as a financial milestone, but as a national inflection point — one that aligns energy reform, capital market innovation, and environmental stewardship.
If effectively implemented, it could redefine Zambia’s energy landscape, stimulate inclusive economic growth, and position the nation as a regional leader in renewable energy and sustainable investment.