Mailo’s merchant model and Zambia’s diversification push
The Mailo Solar Plant, developed by Solarcentury Africa and backed by BB Energy, has completed its first 25MWp phase and begun trading on the Southern African Power Pool (SAPP). According to Solarcentury Africa’s announcement and industry reporting, the plant reached commercial operation after being developed, financed and built in less than twelve months. That timeline underscores the speed that merchant structures can achieve.
The project lies in Zambia’s Central Province and was previously referenced as the Serenje or Mailo project in utility-scale solar tracking, with phase one listed at 25MWp. Mailo is described as the first dedicated merchant solar power plant to trade power through SAPP. It sells electricity directly to large industrial customers and regional traders instead of relying solely on long-term power purchase agreements with a single utility buyer.
As a result, the plant slots into Zambia’s emerging open-access and regional trading framework. Private generators can now access both domestic industrial demand and the wider SAPP market. Industry coverage notes that the merchant model used at Mailo offers a replicable structure for cross-border solar trading in Southern Africa, signalling a shift from sovereign-backed tariffs to market-based pricing backed by regional grid integration.
This commissioning comes as Zambia accelerates solar deployment to diversify away from hydropower volatility. Ministry of Energy data cited by pv magazine shows installed solar PV capacity rising from 88MW in 2021 to about 841MW by mid-2026. Major plants include the 25MW Mailo Phase I and a planned second phase at the same site. Therefore, Mailo is both part of a broader national build-out and an outlier in its merchant, SAPP-linked structure.
The plant’s first phase is expected to generate over 60GWh of clean electricity annually. That is enough to power around 25,000 Zambian homes based on average household consumption, according to project figures shared by Solarcentury Africa. The developer also estimates annual emissions reductions of about 60,000 tonnes of CO₂, or more than 2 million tonnes over the project’s lifetime. This positions Mailo as a modest but material contributor to Zambia’s decarbonisation and energy-security agenda.
How far can the Mailo merchant platform go?
Solarcentury Africa plans to expand Mailo in phases towards a total capacity of 118MWp. Current reporting indicates that phase two construction has started, taking the site from 25MWp towards around 60MWp. A third phase is envisaged to complete the full 118MWp build-out. Construction of the first phase was undertaken by Alensy Energy Solutions of Namibia, highlighting regional engineering participation in Zambia’s solar build.
Financially, Solarcentury Africa has secured an initial US$40m loan from Standard Bank South Africa to support the Mailo expansion. The company describes this facility as the first tranche of a larger lending structure. It is designed to fund a broader merchant power fleet across the Southern African Development Community (SADC). While detailed loan terms have not been disclosed, the deal aligns with a wider trend of commercial banks financing merchant and wheeling-based generation tied to SAPP or national open-access regimes.
BB Energy, Solarcentury Africa’s parent company, has funded other merchant solar ventures in the region. These include the 19.3MWp Gerus project in Namibia, described as the second purpose-built merchant plant to trade power through SAPP after Mailo. Solarcentury Africa states that it aims to develop and operate more than 320MWp of fully merchant solar capacity by 2027. Broader merchant ambitions span the SADC region. In Zambia, its Mailo plant is already cited as an example of a private renewable project operating outside the traditional long-term single-buyer PPA model.
For investors, the Mailo structure signals a tangible shift in risk allocation. The plant sells power to a mix of industrial users and traders via SAPP. This reduces direct exposure to a single utility’s balance sheet and sovereign guarantee constraints, while increasing market and price risk. However, as one analyst summary puts it, merchant solar projects like Mailo are starting to turn regional grid volatility into an investable spread, rather than a pure policy hazard.
The Mailo merchant model will now be tested at scale as phase two construction advances and trading volumes grow. Investors should watch three signals next: how consistently Mailo clears power into SAPP, how Standard Bank and other lenders expand merchant lending across SADC, and whether Solarcentury Africa’s stated target of several hundred megawatts of merchant capacity by the late 2020s translates into a deeper, more liquid regional market for clean industrial power.
Quick answers
Mailo is described as the first dedicated merchant solar power plant to trade electricity directly through the Southern African Power Pool (SAPP), selling to industrial customers and regional traders rather than relying on a single long-term utility power purchase agreement.
Phase one is 25MWp and is now commercially operational. Solarcentury Africa plans to expand the site to around 60MWp in phase two and ultimately to 118MWp across three phases.
Solarcentury Africa has secured an initial US$40m loan from Standard Bank South Africa, described as the first tranche of a larger facility intended to fund a broader merchant solar fleet across the SADC region.
