ZESCO Limited is the gatekeeper for every grid-connected solar project in Zambia. Whether you are a residential prosumer applying for net metering or an independent power developer negotiating a 20-year PPA, ZESCO’s processes, technical standards, and timelines define your project. This guide covers the complete regulatory pathway: ERB licensing categories, the net metering application process, the Small Power Producer framework, grid code technical requirements, and the tax exemptions that make solar equipment imports viable.
Critical Compliance Point
ZESCO requires all grid-connected solar systems to comply with the Zambian Distribution Grid Code. The most common reason for connection rejection is an incomplete single-line diagram or protection settings that do not match the grid code requirements. Anti-islanding protection must disconnect the system within 3 seconds when voltage or frequency limits are exceeded. Failing this test will block commissioning.
ERB Licensing Categories for Solar
The Energy Regulation Board (ERB) is the statutory regulator for all energy sector activities in Zambia. Solar projects must obtain the correct license before construction or operation.
The Four Main License Types
| License Type | Scope | Validity | Annual Fee |
|---|---|---|---|
| Generation | Generating electricity | 30 years | 0.7% of gross turnover |
| Transmission | Bulk power transmission | 30 years | 0.7% of gross turnover |
| Distribution | Electricity distribution networks | 15 years | 0.7% of gross turnover |
| Supply | Electricity supply and trading | 5 years | 0.7% of gross turnover |
A Combined License covering generation, transmission, distribution, and supply is available with a 30-year term. This is commonly used for mini-grid and off-grid developers who need to own the full value chain.
Solar-Specific Licensing
| Activity | License Required | Threshold |
|---|---|---|
| Trading solar equipment | Solar Business License | Any scale |
| Importing solar panels/inverters/batteries | Solar Business License | Any scale |
| Installing solar systems | Solar Business License | Any scale |
| Generating electricity for sale | Generation or Combined License | Above 100 kW |
| Generating electricity for own use | Exempt | Below 100 kW |
The solar business license is renewed annually with a fee of 0.5% of annual turnover from the sale of solar PV panels, inverters, batteries, and charge controllers.
Key Licensing Thresholds
| Capacity | Regulatory Treatment |
|---|---|
| Under 100 kW (own use) | No ERB license required |
| 100 kW to 5 MW | Generation license or net metering |
| 5 MW to 20 MW | Generation license + REFIT eligible |
| Above 20 MW | Generation license + competitive tender |
Licensing Application Requirements
First-time applicants must submit:
- Completed ERB license application form
- 5-year business plan (3-year for renewals)
- Audited financial statements (not older than 2 years)
- Certificate of incorporation from PACRA
- Proof of funds (bank statements or sponsor letter)
- Current shareholders and directors list
- Valid tax clearance certificate from ZRA
- ZEMA environmental permit decision letter
- Zonal approval from local council
- Title deed or letter of consent from Chief or Traditional Leader
The assessment fee is 0.1% of total investment cost.
ZESCO Net Metering Policy
Zambia’s net metering framework is established under the Electricity (Net Metering) Regulations, SI No. 38 of 2024, which took effect on August 1, 2024.
Program Parameters
| Parameter | Detail |
|---|---|
| Legal basis | Electricity (Net Metering) Regulations, SI No. 38 of 2024 |
| Launch date | August 1, 2024 |
| System size range | 5 kW to 5 MW |
| Eligible technologies | Solar PV and other renewable sources |
| Export tariff (2025) | K1.67 per kWh |
| Generation limit | Customer’s contracted or declared demand with ZESCO |
| Meter | Bidirectional smart meter (prosumer bears cost) |
Tariff Structure
| Export Level | Credit Rate |
|---|---|
| Exports 50% or less of total generation | 100% of reference tariff |
| Exports 50-75% of total generation | 75% of reference tariff |
The ERB determines the reference tariff annually, published in the last month of each year for the following year.
Program Status (Early 2025)
| Metric | Figure |
|---|---|
| Prosumers connected | 521 |
| Total installed capacity | 15.3 MW |
| Electricity exported to grid | 12,228 MWh |
| Total credits paid out | K3,685,032 |
Application Process
Submit Application to ZESCO
Submit the Prosumer Application Form (Doc Number: DS.13510.FORM.03390) to the nearest ZESCO Customer Service Centre or through the net metering portal at netmetering.zesco.co.zm. Include credentials of the Competent Person undertaking the installation, certified by the Engineering Institution of Zambia (EIZ).
Pay Administrative Fee
Pay the nominal administrative fee as approved by ERB at the time of submission. Receive an acknowledgement receipt with a reference number for tracking.
Site Verification and Technical Assessment
ZESCO conducts a site visit to assess technical feasibility. The assessment ensures the system can be safely connected to the grid and evaluates safety and compatibility requirements.
Approval and Agreement Signing
If approved, pay connection costs and sign two key agreements: the Net Metering Supply Agreement (NMSA) and the Net Metering Connection Agreement (NMCA). ZESCO will reject applications that do not meet technical standards, with stated reasons.
Installation and Commissioning
Install the renewable energy system per the approved design. Submit the Renewable Energy System Installation Completion Certificate to ZESCO. ZESCO installs the net meter at the premises (prosumer bears the cost) and commissions the system.
Billing and Settlement
| Meter Type | Settlement Method |
|---|---|
| Pre-paid | Export credits added to meter account; subsequent purchases reduced by credit value |
| Post-paid | Monthly bill charged for imports less monetary value of exports |
Prosumer credits can be used to reduce current or future electricity bills. Reconciliation follows Regulation 23 of the Net Metering Regulations.
Small Power Producer (SPP) Framework
The SPP framework covers solar projects too large for net metering but below utility-scale competitive tender thresholds.
Micro-Generator Scheme
| Feature | Detail |
|---|---|
| Capacity range | 100 kW to 5 MW |
| Total capacity signed | 270 MWp (as of February 2025) |
| Number of projects | 28-29 IPPs with signed PPAs |
| Construction timeline | 2 months to commence; 3-8 months delivery for smaller projects |
REFIT Program
The Renewable Energy Feed-in Tariff (REFIT) program governs solar projects up to 20 MW:
| Solar PV Size Range | Benchmark Tariff (US cents per kWh) |
|---|---|
| 500 kW to under 1 MW | 17.82 |
| 1 MW to under 5 MW | 16.76 |
| 5 MW to under 10 MW | 15.74 |
| 10 MW to 20 MW | 14.25 |
Key REFIT terms:
- ZESCO is the mandatory off-taker
- Minimum 20-year PPA term from commercial operation date
- USD-denominated tariffs with annual CPI indexation from July 2016
- Guaranteed purchase of all energy delivered
- Full cost pass-through to ZESCO’s retail tariff
Grid Connection for SPPs
| Step | Action | Responsible Party |
|---|---|---|
| 1 | Submit grid connection application to ZESCO | Developer |
| 2 | ZESCO conducts stability studies and cost estimates | ZESCO |
| 3 | Developer pays interconnection costs upfront | Developer |
| 4 | ZESCO processes design, construction, commissioning | ZESCO (or developer with prior arrangement) |
| 5 | Execute Grid Connection Agreement | Both parties |
| 6 | ZESCO connects plant to national grid | ZESCO |
Interconnection costs — including transmission lines, substations, and upgrades — are borne entirely by the developer. The REFIT benchmark tariffs include a standardized allowance for these costs.
Grid Code Technical Standards
The Zambian Distribution Grid Code establishes the technical requirements for all renewable energy plants connecting to the ZESCO network.
Connection Capacity Limits
| System Type | Maximum Capacity |
|---|---|
| Single-phase small embedded generators | 10 kVA |
| Three-phase systems | 30 kVA |
| Variable Renewable Energy at any POC | 50 MWac recommended |
Protection and Safety Requirements
| Parameter | Requirement |
|---|---|
| Grid impact study | Required for connections above 100 kVA |
| Inverter standards | Must comply with relevant IEC standards |
| Voltage variations | Must not exceed limits stated in ZS 387 |
| Phase jump withstand | Designed to withstand sudden phase jumps up to 20 degrees |
| Anti-islanding protection | Mandatory disconnection within 3 seconds when voltage exceeds limits |
| DC content limit | Maximum 0.5% of rated output current at AC terminals |
| Reactive power | Required capability for voltage control |
Common Rejection Reasons
| Issue | Correct Approach |
|---|---|
| Incomplete single-line diagram | Include all protection relays, metering, and correct symbols |
| Protection settings outside permitted range | Use values from inverter’s type-test certificate |
| Inverter without IEC certification | Specify make, model, and certification reference |
| Missing grid impact study | Commission study for all systems above 100 kVA |
| Export limiting device not specified | Document where required by ZESCO |
Import Duty Exemptions and VAT
Zambia offers significant tax incentives for solar equipment, though the details vary by product category.
Current Tax Incentives
| Incentive | Rate | Legal Basis | Valid Until |
|---|---|---|---|
| VAT on solar equipment | 0% (zero-rated) | SI 104 of 2021 | Ongoing |
| Customs duty suspension on solar power equipment | Suspended | 2024 Budget | December 31, 2027 |
| VAT on electricity generation equipment | 0% | 2024 Budget | December 31, 2033 |
| Accelerated depreciation | 50% first-year wear-and-tear | Income Tax Act | Ongoing |
Duty Rates by Product (2025)
| Product | Typical HS Code | Customs Duty | VAT |
|---|---|---|---|
| Solar PV panels | 8541.43.00 | 25% | 0% |
| Lithium-ion batteries | 8507.60.00 / 8507.80.00 | 0-5% | 0% |
| Solar inverters | 8504.40.00 | 0-5% | 0% |
| Charge controllers | 8537.10.00 | 0-5% | 0% |
| Solar water heaters | 8419.12.00 | 0-5% | 0% |
| Solar street lights | 9405.41.00 | 0-5% | 0% |
The 25% customs duty on solar panels is a critical exception. While most solar components enjoy low or zero duty, panels attract the full rate. Importers should verify HS codes with ZRA before ordering.
Requirements to Qualify
| Importer Type | Requirements |
|---|---|
| Businesses | ERB import license + product quality certificates |
| Individuals | ERB/ZRA Self-Declaration form (non-commercial) |
| All importers | Proper HS code classification, correct documentation |
ZRA Guidance
The Zambia Revenue Authority has specifically urged suppliers to pass tax savings to consumers through reduced prices. Despite tax breaks, solar equipment remains expensive for many Zambians. Proper documentation and correct HS classification are essential to realize the full benefit of these incentives.
Generate ZESCO-Compliant Solar Documentation Automatically
SurgePV produces single-line diagrams, protection settings schedules, and grid impact study inputs that align with the Zambian Distribution Grid Code — ready for ZESCO submission.
Book a Free DemoNo commitment required · 20 minutes · Live project walkthrough
Open Access and Power Wheeling
The Electricity (Open Access) Regulations, SI No. 40 of 2024 introduced a significant reform for solar developers:
| Category | Duration | Minimum Capacity |
|---|---|---|
| Long-term open access | More than 5 years | 1 MW |
| Medium-term open access | 3 months to 5 years | 1 MW |
| Short-term open access | Less than 3 months | 1 MW |
Qualifying participants — traders, suppliers, and consumers at 1 MW and above — can now access ZESCO’s transmission and distribution networks to sell electricity directly to third-party buyers for a regulated wheeling fee. This creates new revenue opportunities for C&I solar developers who can serve off-site customers.
Common Mistakes in ZESCO Applications
| Mistake | Why It Happens | Correct Approach |
|---|---|---|
| Applying with non-certified inverter | Cost-cutting on equipment | Only specify IEC-certified inverters with valid type-test documentation |
| Undersizing protection relays | Using residential-grade equipment for C&I projects | Size all protection equipment for the system’s maximum fault current |
| Missing EIZ certification for installer | Using uncertified contractors | Ensure the Competent Person holds valid EIZ certification |
| Incorrect HS code on import documentation | Lack of ZRA consultation | Verify HS codes with ZRA before shipment to avoid duty disputes |
| Skipping environmental clearance | Assuming exemption applies | Submit EPB to ZEMA for all ground-mount and large rooftop systems |
Related Zambia Compliance Guides
- Zambia Solar Compliance Guide — National ERB licensing, tax exemptions, and rural electrification
- Lusaka Solar Compliance Guide — Lusaka City Council permits and ZESCO connection specifics
Frequently Asked Questions
What are the ERB licensing categories for solar projects in Zambia?
The ERB issues four main license types: Generation (for electricity generation above 100 kW, valid 30 years), Transmission (for bulk power transmission, valid 30 years), Distribution (for electricity distribution networks, valid 15 years), and Supply (for electricity trading to consumers, valid 5 years). A Combined License covering all four activities is available for 30 years. Generation below 100 kW for own use is exempt. Solar business licenses for trading and installation are renewed annually.
How do I apply for ZESCO net metering?
Apply through the ZESCO net metering portal at netmetering.zesco.co.zm. Submit the Prosumer Application Form (DS.13510.FORM.03390), credentials of a Competent Person certified by the Engineering Institution of Zambia (EIZ), and a single-line diagram. Pay the administrative fee, undergo a ZESCO site verification, then sign the Net Metering Supply Agreement and Net Metering Connection Agreement. ZESCO installs a bidirectional smart meter at the prosumer’s cost and commissions the system.
What is the SPP framework in Zambia?
The Small Power Producer (SPP) framework in Zambia covers solar projects from 100 kW to 5 MW under the Micro-Generator Scheme. As of February 2025, ZESCO signed PPAs for 270 MWp across 28-29 projects. The REFIT program guarantees purchase of all energy delivered with 20-year PPAs denominated in USD with annual CPI indexation. ZESCO is the mandatory off-taker. Interconnection costs are borne by the developer.
What technical standards apply to grid-connected solar in Zambia?
Grid-connected solar must comply with the Zambian Distribution Grid Code. Key requirements include: grid impact studies for systems above 100 kVA, IEC-compliant inverter standards, voltage variation limits per ZS 387, anti-islanding protection (disconnection within 3 seconds), maximum DC content of 0.5% of rated output current, and reactive power capability. Single-phase systems are limited to 10 kVA and three-phase to 30 kVA without special studies.
Are solar inverters and batteries duty-free in Zambia?
Solar inverters and batteries benefit from favorable duty treatment. Under the 2024 Budget, customs duty on solar power equipment, generators, and components is suspended through December 31, 2027. Inverters and batteries typically face 0-5% customs duty. VAT is zero-rated at 0% on all eligible solar equipment under SI 104 of 2021. However, solar panels specifically attract 25% customs duty. Proper HS code classification with ZRA is essential.
