The Eswatini Electricity Company (EEC) has issued a Request for Proposals (RFP) for the engineering, procurement and construction (EPC), together with financing, of an additional 10 MW hydropower generating unit at the existing Maguga Hydropower Station.
The project would expand the existing 20 MW Maguga power station, which comprises two 10 MW generating units, by adding a third 10 MW unit. The new unit is to be developed adjacent to the existing plant and integrated with the existing dam, waterways and electrical infrastructure.
Expanding an existing hydropower station
The proposed development is a brownfield expansion of the existing Maguga Hydropower Station. The objective is to add approximately 10 MW of renewable generation capacity while maintaining the safe and reliable operation of the existing dam and generating facilities.
According to the RFP, the additional unit is intended to increase renewable electricity generation, improve energy security and make better use of the hydropower potential available at the site.
The expansion has been held back by financial constraints experienced by EEC. The utility is therefore seeking a partner able to close the financing gap and enter into commercial arrangements that provide a bankable basis for developing the project.
EPC plus financing
EEC is inviting proposals from suitably qualified and experienced:
- EPC contractors;
- project developers;
- investors; or
- EPC/developer/investor-led consortia.
The successful bidder will be expected to provide a complete and bankable solution, covering engineering, procurement, construction, testing and commissioning, together with development, investment and financing arrangements as appropriate.
The RFP allows bidders considerable flexibility in proposing the commercial structure. Possible approaches include EPC, EPC plus finance, or a BOOT/IPP structure, among others.
Under a BOOT/IPP structure, for example, a developer could finance, construct, own and operate the project for an agreed period under a long-term power purchase arrangement before transferring the facility to EEC or another designated entity.
Scope of work
The selected bidder will be responsible for delivering the complete project, with the precise technical solution to be confirmed following detailed investigations and discussions.
The scope includes:
- review and validation of available project information, studies, drawings and site data;
- detailed hydrology review;
- hydraulic transient analysis;
- geotechnical investigations;
- interface studies with the existing civil works, waterways and electrical systems;
- detailed engineering and design of the new 10 MW generating unit and associated facilities;
- procurement, manufacture, transportation, installation and construction;
- civil, hydraulic, steelwork, electromechanical and electrical works;
- control, protection and SCADA integration;
- grid and substation modifications required for the new unit;
- testing, commissioning and performance testing;
- operator training and handover; and
- preparation of as-built drawings, operation and maintenance manuals, warranties and completion documentation.
The bidder must also propose how the project will be financed and how the investment will be recovered. The commercial proposal is expected to address the proposed tariff or payment mechanism, agreement tenure, payment security and other key commercial assumptions.
Interestingly, EEC has clarified that an indicative EPC price is sufficient at this stage, subject to due diligence, OEM quotations and subsequent negotiations. Similarly, letters of interest from potential financiers are considered sufficient rather than firm financing commitments at the proposal stage.
Hydrology and water availability
An important aspect for potential investors is the allocation of hydrological risk. EEC has indicated that the bidder will carry the hydrology and water-availability risk, with the tariff expected to reflect this risk and provide sufficient recovery of the investment and an appropriate return.
At the same time, releases from the Maguga reservoir are subject to the KOBWA Operations Guidelines, reflecting the wider water-management and downstream irrigation requirements of the system.
EEC has made the feasibility study and other project information available to prospective bidders, including hydrology analysis and existing plant information.
Financing and local participation
The financing proposal is expected to set out indicative pricing and tenor, lender appetite, sponsor or investor support, equity commitments, the respective financing responsibilities of consortium members and any requirements for guarantees or other forms of support.
There is no fixed percentage for local participation specified in the RFP. Instead, bidders are invited to propose their approach to local participation, training and skills transfer, with a higher level of local participation receiving additional points during evaluation.
Deadline for proposals
Following an extension announced by EEC, proposals must be submitted no later than 11:00 on 31 August 2026.
The opportunity is likely to be of particular interest to hydropower equipment suppliers and EPC contractors able to work with project-finance partners, as well as developers and investors looking for an opportunity to develop a relatively modest-sized hydropower project on an existing dam and power station site.
Download the Request for Proposals from the Eswatini Electricity Company