Maputo: Mozambique is moving forward with one of Africa’s most ambitious power expansion programs, combining mega-hydroelectric projects with decentralized renewable energy initiatives, as the country seeks to transform itself into a regional electricity hub.

At the center of this effort is the \$6 billion Mphanda Nkuwa hydroelectric project, which is expected to generate 1,500 megawatts when it comes online in 2031. Built downstream from the Cahora Bassa dam, the project is seen as critical to reducing a regional electricity deficit estimated at 10,000 megawatts. Although the World Bank is not directly funding construction, it is supporting the project with concessional financing, risk guarantees, and political risk insurance.

Mozambique has already recorded strong progress in expanding access to electricity. The national connection rate has nearly doubled from 31 percent in 2018 to 60 percent in 2024. Last year alone, 563,000 households were connected to the grid, with the government targeting an additional 600,000 households in 2025. These new connections are having visible effects on daily life, powering small businesses, enabling pharmacies to store medicines, and improving services in rural communities.

In parallel, the World Bank’s ASCENT Mozambique program, launched earlier this year, aims to extend power to nearly one million people through a mix of grid connections, solar mini-grids, and clean cooking solutions. Off-grid solar already accounts for around 10 percent of electricity access in Mozambique, underscoring the importance of decentralized solutions in reaching remote areas.

The country is also diversifying its renewable energy sources. The 41-megawatt Metoro solar power plant has been supplying energy since 2022, while the 20-megawatt Cuamba solar plant with battery storage began operating in 2023. Mozambique’s first large-scale wind farm, the 120-megawatt Namaacha project, is currently under development.

Despite these gains, concerns remain about financial sustainability. Mozambique’s public debt reached \$17 billion in early 2025, with \$2.1 billion spent on debt servicing in 2023 alone. Critics warn that heavy borrowing for mega infrastructure projects could strain public finances.

Still, the government and international partners are optimistic. World Bank President Ajay Banga has said Mozambique could become a regional electricity supplier if its projects are managed effectively. The initiative also aligns with the broader Mission 300 plan, led by the World Bank and African Development Bank, which seeks to provide electricity to 300 million people across Sub-Saharan Africa by 2030.

For Mozambique, the challenge lies in striking a balance: harnessing its abundant hydropower and renewable resources to drive growth and regional integration, while ensuring that expansion does not deepen the country’s debt burden or leave rural communities behind.