Maputo, July 31, 2026 (Lusa) - The Cahora Bassa Hydroelectric Power Station (HCB), in central Mozambique, plans to invest €1.2 billion to modernise its power generation and transmission infrastructure, and expects to return to profitability in 2026 following the impact of the drought caused by the El Niño phenomenon.
According to the 2025 Annual Report and Accounts, the company has signed a €100 million credit facility with the French Development Agency (AFD) to finance the rehabilitation and modernisation project for the Cahora Bassa South Power Station, which forms part of the CAPEX Vital programme.
The overall plan, scheduled to last 10 years, involves estimated investments of €1.2 billion to refurbish the main energy production and transmission systems, including the hydroelectric power station and the Songo converter substation. The company plans to begin refurbishing the first of the five generator sets in 2028, at a rate of one per year.
HCB is also set to benefit from a European Union grant, channelled through the AFD, to fund initiatives in water management, vocational training, digitalisation, cybersecurity, upgrading power transmission lines and the implementation of inclusive gender policies, the report states.
HCB operates, under a concession agreement, the Cahora Bassa hydroelectric scheme in Tete, one of Africa's largest energy infrastructure projects. The project currently comprises the South Power Station, which is operational with an installed capacity of 2,075 megawatts, the planned North Power Station, with the potential to generate up to 1,200 megawatts, and the Songo converter substation and associated transmission infrastructure. It also envisages a solar power station within the hydroelectric project area.
Companhia Elétrica do Zambeze (CEZA) owns 85% of the company, the Portuguese firm REN holds 7.5%, whilst 4% is held by Mozambican investors, and 3.5% consists of treasury shares.
The Cahora Bassa reservoir is the fourth-largest in Africa, with a length of 270 kilometres, a width of 30 kilometres, an area of 2,700 square kilometres, and an average depth of 26 metres.
It employs over 700 workers and is one of the largest electricity producers in southern Africa, supplying neighbouring countries.
The annual report and accounts also indicate that the hydrological constraints caused by the El Niño phenomenon presented significant challenges for HCB's operations in 2025: «They resulted in a reduction in production and a consequent reduction in the company's net profit».
HCB's net profit fell by 49.6% to 7,123 million meticais (€96.3 million), compared with the 14,126 million meticais (€190.5 million) recorded in 2024.
Revenue from sales and services also fell by 37.1% to 22,019 million meticais (€297.8 million), in line with the reduction in the volume of energy sold.
According to the company, energy sales totalled 9.9 million megawatt-hours (MWh), 31.1% less than the 14.4 million MWh recorded in 2024.
Despite the fall in production, HCB maintained a positive operating profit of 8,474 million meticais (€114.7 million) and assets exceeding 101 billion meticais (€1.37 billion).
In developments following the 2025 financial statements, the company notes a significant recovery in storage levels at the Cahora Bassa reservoir, pointing to improved operational prospects. The reservoir level rose from 27.23% at the end of 2025 to 51.67% on 25 March 2026, whereas in the same period of the previous year it stood at 26.03%.
«This development bodes well for 2026, with better results expected compared to 2025,» the management said.
PVJ/ADB // ADB.
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