The African Development Fund’s (ADF) Board of Directors has approved a grant of US$22.9 million for the rehabilitation of Malawi’s Kapichira and Nkula B hydropower plants, marking a transformative investment in the nation’s energy future.
The $118.7 million initiative, bolstered by co-financing opportunities, is set to rehabilitate two vital power generation facilities—Kapichira I (64 MW) and Nkula B (100 MW). The Kapichira plant, located in Chikwawa District, plays a crucial role in serving the southern region of Malawi. Meanwhile, Nkula B, the oldest major hydropower station in the country, has been operational since 1966 and currently supplies approximately half of Malawi’s electricity. Unfortunately, both facilities are functioning well below capacity, primarily due to ageing infrastructure and extensive damage sustained during recent cyclones.
Macmillan Anyanwu, the African Development Bank’s country manager for Malawi, expressed the project’s significance by stating, “This project represents a cornerstone investment in Malawi’s economic transformation. By restoring these hydropower plants to optimal performance, we are not just fixing infrastructure—we are unlocking economic potential, creating jobs, and bringing reliable electricity to communities that have struggled with chronic power shortages.”
One of the most promising aspects of the rehabilitation effort is its projected increase in annual energy generation by an impressive 55%, raising the output from 916 GWh to 1,426 GWh. Additionally, the operational lifespan of these ageing facilities is expected to extend from 22 years to an impressive 47 years. This upgrade will enhance the plants’ performance from 80% to 95%, virtually eliminating the forced outages that have long plagued the nation’s electricity supply.
Malawi faces a stark reality when it comes to energy access, with only 25.9% of the population currently having electricity. This statistic places Malawi among the lowest rates in Africa. The situation worsened in 2022 when Tropical Storm Ana severely damaged the Kapichira plant, which is responsible for approximately 30% of the country’s generating capacity.
The rehabilitation project directly aligns with Malawi’s Vision 2063 and the Malawi Energy Compact, signed in January 2025 under the Mission 300 initiative. This ambitious mission aims to provide electricity access to 300 million Africans by 2030. Beyond the numbers, reliable electricity will have a ripple effect, enabling the expansion of crucial sectors such as agriculture, mining, and manufacturing. It will also reduce business costs associated with diesel generators and power outages, significantly improve healthcare delivery and educational outcomes, and support Malawi’s urbanization goals while fostering regional integration through the Southern Africa Power Pool.
The Government-owned Electricity Generation Company will serve as the executing agency for this vital rehabilitation project, with implementation set to take place from March 2026 to December 2030. This initiative not only aims to revive ageing infrastructure but positions Malawi to capitalize on upcoming regional opportunities as well. These opportunities include connecting to the Southern Africa Power Pool via the Mozambique-Malawi interconnector, potential integration with the East Africa Power Pool through the proposed Malawi-Tanzania interconnector, and enhanced infrastructure upgrades such as the 132 kV Eastern backbone and 400 kV Western backbone. Furthermore, it will enhance the ability to absorb additional generation from the upcoming 358 MW Mpatamanga hydropower plant.
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