In December 2025, the African Development Fund (ADF) — the concessional lending arm of the African Development Bank Group — approved a $22.9 million grant for the rehabilitation of Malawi’s Kapichira and Nkula B hydropower plants.
These two stations, both on the Shire River, are central to Malawi’s generation base. Structural damage and equipment failures at both plants have been responsible for more than 70 MW of capacity loss — a significant portion of an already constrained grid.
What the rehabilitation covers
The grant will fund repairs and upgrades to generating units at Kapichira and Nkula B, restoring capacity that has been offline due to civil and mechanical damage. The specific works involve turbine rehabilitation, civil structure repairs, and associated electrical and control systems.
Restoring this capacity will not resolve Malawi’s energy deficit entirely, but it will address the most immediate source of generation shortfall and reduce the frequency of load shedding.
How this fits the energy investment picture
The AfDB rehabilitation grant is one component of a multi-track energy investment strategy:
| Project | Value | Status (Dec 2025) |
|---|---|---|
| Mpatamanga Hydropower | $350M (World Bank) | Approved May 2025, construction preparation |
| Rural Electrification (MEAP) | $150M (World Bank) | Approved April 2025, implementation |
| Kapichira/Nkula B rehabilitation | $22.9M (AfDB) | Approved December 2025 |
| Malawi-Mozambique Interconnection | 50 MW import | In progress |
Together, these represent the most concentrated energy infrastructure investment in Malawi’s history over a 12-month period.
Timeline expectations
Rehabilitation projects of this type typically take 12–24 months to complete, depending on equipment procurement lead times and civil works complexity. Companies planning operations for 2026–2027 should expect a gradually improving energy situation rather than an immediate transformation.
The AfDB’s broader Malawi strategy
The AfDB’s Country Strategy for 2023–2028 identifies energy, transport, water, and agriculture as its four priority areas for Malawi. The hydropower rehabilitation grant is consistent with this commitment. The Bank also published a Country Focus Report in 2025 on improving Malawi’s capital markets, reflecting engagement across multiple sectors.
Our read
The Kapichira/Nkula B rehabilitation is the most directly relevant short-term energy project for businesses currently operating in Malawi. Restoring the lost 70+ MW addresses the most immediate cause of the current shortfall. For companies doing operational planning for 2026, this is a meaningful positive development — though generator backup planning remains necessary.
Sources: African Development Bank press release December 2025, AfDB Malawi country page.