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Mozambique has officially entered into a 5 billion U.S. dollar agreement with a consortium led by French energy giant EDF to construct the Mphanda Nkuwa hydropower project.

Planned for the Tete province in northern Mozambique, the dam and hydropower plant will initially generate 1,500 megawatts of power, marking a significant stride towards utilizing the country’s abundant energy resources.

According to Mozambique’s Energy Minister, Carlos Zacarias, the project positions the nation as a regional supplier of clean, renewable energy, fostering economic growth.

The hydropower facility will link Tete to the capital, Maputo, through a 1,300 km transmission line. Expected to be operational by 2031, the venture will provide affordable electricity, solidifying Mozambique’s role as a net exporter of power. The consortium, led by EDF and including TotalEnergies and Sumitomo Corporation, will spearhead the development, construction, and operation of the project.

The consortium holds a majority 70 percent stake, with Mozambique’s power utility EDM and Hidroeléctrica da Cahora Bassa (HCB) owning the remaining 30 percent.

The move not only addresses Mozambique’s energy needs but also supports the nation’s ambition to contribute to Southern Africa’s energy transition. The project, which could increase Mozambique’s electricity production capacity by over 50 percent, aligns with international standards in environmental and social governance.

With the support of the African Development Bank and the World Bank’s International Finance Corporation, the consortium plans to conduct additional studies to ensure the project’s environmental, social, and financial viability.