For years, the conversation around Zambia’s energy sector has been dominated by one word: Generation. Given the rising electricity demand projected in the Integrated Resource Plan (IRP), the focus on building more power plants seemed a logical necessity. However, a power plant is only as good as the wires that carry its energy. The 2026 National Budget has sent a significant, long-awaited signal to the market. By introducing duty relief for machinery and equipment required for the transmission and distribution of electricity, the government has finally started addressing the "missing link" in Zambia’s energy value chain.
Zambia’s Vision 2030 outlines an ambitious goal of universal access to electricity, yet, despite steady investment in generation, the transmission infrastructure has remained a bottleneck. Achieving universal access is impossible if the "highway" for electricity is either absent in rural areas or outdated and congested in industrial hubs. Historically, even with government encouragement for private sector participation, investment in transmission has lagged due to the high capital expenditure required for specialized equipment. The 2026 budget clause is not merely a tax break, but a strategic pivot, lowering the cost of entry for private investors and modernizing the grid to accommodate renewable energy sources. The reduction of barriers allows private entities to build the necessary infrastructure for transferring power efficiently and makes it easier for distribution companies to extend their services to underserved areas. This policy shift signals a recognition that a diverse pool of market participants is essential for meeting infrastructure needs, giving investors the impetus to move projects from the feasibility stage to procurement. Hence, with a more robust transmission infrastructure, Zambia can aspire to become a regional energy hub. Generation creates power, but transmission creates a market; with duty relief now implemented, Zambia is poised to seek not just more power, but a smarter way to deliver it.
By Mr.Emmanuel Kanchebele