Zambia’s commercial and industrial (C&I) energy market is entering a new phase of development.
Driven by power shortages, increasing electricity demand, mining sector expansion and growing investment in renewable energy, businesses across the country are reassessing how they secure and manage electricity.
What was once largely a discussion about access to power has become a broader conversation about energy resilience, cost management and long-term supply security.
For commercial and industrial energy users, 2026 represents both a challenge and an opportunity.
While power shortages have exposed certain weaknesses within Zambia’s electricity system, they have also accelerated investment in solar PV, battery energy storage, private generation and alternative power procurement models.
As a result, Zambia is increasingly emerging as one of Southern Africa’s most active C&I energy markets.
The catalyst for much of the market’s recent transformation has been the severe drought that affected large parts of Southern Africa during 2024 and 2025.
Zambia remains heavily dependent on hydropower, which historically supplied the majority of the country’s electricity.
Reduced rainfall and declining water levels at major reservoirs significantly constrained generation capacity, leading to widespread load shedding and power rationing.
The situation highlighted the risks associated with reliance on a single dominant generation source and reinforced the need for a more diversified energy mix.
The impact was particularly significant for energy-intensive industries such as mining, manufacturing and processing operations, where electricity reliability directly affects productivity and operating costs.
According to Reuters, Zambia’s dependence on hydropower left the country vulnerable to drought-related disruptions, prompting both government and industry to accelerate efforts to diversify generation sources.
President Hakainde Hichilema, speaking at the launch of Zambia’s largest grid-connected solar project in 2025, stated that the drought had demonstrated the urgent need to diversify the country’s power mix.
For many C&I energy users, that diversification is no longer viewed as a future objective but as an immediate business requirement.
ALSO READ: What makes energy projects bankable in Africa – a practical guide
While Zambia is attempting to address supply constraints, electricity demand continues to grow.
The country’s ambition to significantly increase copper production is expected to place additional pressure on the power system. Zambia’s mining sector remains the backbone of the economy and is attracting substantial new investment.
Reuters reported in 2026 that the government expects economic growth to strengthen on the back of expanding mining activity, with major investments underway at operations including Kansanshi and Lumwana.
Copper production is expected to rise significantly over the coming years as Zambia pursues its ambition of becoming one of the world’s leading copper producers.
This growth presents a challenge for policymakers and utilities.
Meeting rising industrial demand while improving reliability for existing customers will require substantial investment in generation, transmission and distribution infrastructure.
It also creates opportunities for private-sector participation in energy supply and infrastructure development.
As mining companies seek greater control over energy costs and reliability, many are increasingly evaluating dedicated renewable energy projects, hybrid systems and direct procurement arrangements.
Perhaps the most visible change in Zambia’s energy sector has been the acceleration of solar energy deployment.
In June 2025, Zambia commissioned the 100 MW Chisamba solar project, developed by PowerChina and supplying electricity to First Quantum Minerals.
The project is currently the country’s largest grid-connected solar power facility and represents a significant milestone in efforts to diversify generation capacity.
The project demonstrates a broader shift taking place across the market.
Rather than viewing solar energy solely as a utility-scale solution, businesses are increasingly exploring on-site and behind-the-meter solar installations as a means of reducing exposure to grid instability and rising electricity costs.
Recent industry reports indicate that hundreds of megawatts of additional renewable energy projects are expected to come online between 2025 and 2026 as Zambia accelerates efforts to strengthen energy security and diversify generation sources.
For commercial and industrial customers, solar PV is increasingly being evaluated not only as a sustainability initiative but as a core business continuity strategy.
While solar deployment continues to grow, energy storage is emerging as one of the most important technologies supporting Zambia’s evolving C&I energy market.
Battery energy storage systems are increasingly viewed as essential for managing intermittency, improving power quality and supporting operational resilience.
Globally, investment in battery storage is accelerating rapidly.
According to the International Energy Agency’s 2025 World Energy Investment Report, global battery storage investment is expected to reach approximately US$66 billion, reflecting the growing importance of storage technologies within modern electricity systems.
The IEA has consistently highlighted that achieving renewable energy growth objectives will require significant investment in both storage and grid infrastructure.
As IEA Executive Director Fatih Birol noted, “sufficient energy storage” is essential for secure and successful energy transitions.
For Zambia’s commercial and industrial sector, battery storage is increasingly being considered alongside solar PV as part of integrated energy resilience strategies rather than as a standalone technology.
The market is also seeing growing interest in alternative procurement structures.
Corporate power purchase agreements (PPAs), embedded generation models and private-sector energy investments are becoming increasingly important components of Zambia’s energy landscape.
The country’s regulatory framework has continued to evolve, with institutions such as the Energy Regulation Board playing a central role in licensing, tariff oversight and approval of power purchase agreements.
Meanwhile, Zambia’s long-standing efforts to encourage private participation in the power sector are gaining renewed relevance as investment requirements continue to grow.
For developers, financiers and large energy users, the growing acceptance of private-sector participation creates opportunities to structure projects that can support both energy security and economic growth.
The challenge now lies in improving project bankability, strengthening financing mechanisms and reducing barriers that continue to slow project development.
While generation projects often attract the most attention, industry experts increasingly argue that transmission infrastructure may become the defining issue for the next phase of market development.
Across Southern Africa, governments, utilities and investors are placing greater emphasis on strengthening regional transmission networks and improving cross-border electricity trading.
In 2024, the Southern African Power Pool and Climate Fund Managers launched a US$1.3 billion transmission investment initiative aimed at accelerating regional grid development and supporting greater power system integration.
Within Zambia itself, infrastructure investment is also accelerating.
Reuters reported in 2025 that Copperbelt Energy Corporation planned to invest approximately US$500 million in power projects and transmission infrastructure to support growing demand and improve network capacity.
For C&I energy users, transmission investment is often overlooked but remains fundamental to long-term energy security. Additional generation capacity alone cannot resolve supply challenges if power cannot be delivered efficiently to where it is needed.
The outlook for Zambia’s C&I energy market in 2026 is increasingly positive, although significant challenges remain.
Power shortages, financing constraints and infrastructure gaps continue to affect project development.
However, the market is also benefiting from strong fundamentals, including growing industrial demand, increasing private-sector participation, supportive policy reforms and rising investment in renewable energy.
The World Bank’s 2026 Zambia Economic Update highlighted the urgency of power sector reforms, diversification of energy sources and improvements in the financial sustainability of the electricity sector.
For commercial and industrial energy users, the key question is no longer whether the market will change, but how quickly that change can be translated into bankable projects and reliable power supply.
The businesses that succeed in this environment are likely to be those that adopt a more strategic approach to energy procurement, combining grid supply with renewable generation, storage solutions and long-term energy planning.
As Zambia continues its transition towards a more diversified and resilient electricity system, the C&I sector will remain at the centre of that transformation.
READ NEXT: How utilities can navigate the energy transition – a strategic planning guide
Contact Us
VUKA is the trusted media partner to key professionals, policy makers, suppliers and
manufacturers. We provide unparalleled opportunities for industry-wide connection.
