In a bid to accelerate distributed electricity generation to supply rural areas, the Department of Energy Affairs is implementing a 50 kW Micro-hydro power scheme in Kavuzi area Nkhatabay District. This is being done under Increasing Access to Clean and Affordable Decentralized Energy Services Project, with funding from the Global Environment Facility (GEF) and UNDP. When completed, the power scheme will supply about 500 households and SMEs in the area. Currently feasibility study and designs for the project have been completed.

The development of the power scheme is consolidating available indigenous knowledge in hydro power small scale generation. People in the area had been using self-built induction machines to generate power in streams around the area. This resulted in very unsafe installations that prompted government intervention. Government of Malawi sees the Kavuzi Micro Power scheme as having potential to encourage District Councils and communities to identify areas with potential for power generation in their locations. This will in turn facilitate acceleration of rural electrification. The micro-grid will be owned and managed by the Kavuzi community through a registered association called Kavuzi Electricity Generation and Supply Association (KEGSA).