09:30
rwandaexpress
Prime Minister, Pierre Damien Habumuremyi, (centre), called for a private-public partnership to tackle the country’s energy deficit
With the current supply of electricity from different sources estimated at 100MW, government ofRwanda has set as strategic objective to have installed capacity of 1000MW by 2017, an international investment conference in Kigali learnt.
A strategic plan presented to more than 250 delegates including the Prime Minister, Pierre Damien Habumuremyi, at the two-day conference (February 27-28) shows that to solve the energy shortagethe country could face, some 200 MW will have to be added to the national grid every years.
By 2017, the country must have at least 1,000MW of installed capacity (on/off grid). To get there, it means the authorities must plan to expand the electricity supply by 200 percent annually.
How feasible will that plan be? The strategic plan presented by the ministry of infrastructuresummarises solution into three scenarios:
- Tapping multiple source simultaneously: methane gas, hydro power, geothermal, solar, biogas, mini hydro plants
- Clean renewable energy sources
- Funding for the strategic plan
Like all dreams, any such development agenda of this magnitude comes with a hefty price tag. According to estimates, to implement this ambitious agenda, Rwanda is seeking at least $5 billion to finance the multiple energy projects for the next seven years as it moves to cut back on its current energy deficit.
Key investment opportunities and amounts involved include:
- 20 mini, small hydropower projects totalling 9MW — $20m-$30m
- Developing medium hydropower (12MW-17MW) — $80 million
- Ruzizi III (145MW) — with an expected capital of $450 m
- 90MW Rusumo falls — $300m.
Some of these projects already have funding and are at implementation stages such as the Rusizi III and Rusumo fall hydro power plants. Recently, the government also established a regulatory framework for communal mini power plants whereby by individuals set up own plants and give power to neighbours. Many have been springing up over the past years.
Speaking the conference on the first day, the Prime Minister, said government called for a private-public partnership. He said government would provide all the necessary support to prospective investors.
“Rwanda has set an ambitious goal to significantly increase our energy production working with investors,” said Habumuremyi at the ‘Energy sector policy, legal and regulatory framework’ conference.
Electricity tariffs in Rwanda are said to be highest in this region – at more than $0.22 per kilowatt, as compared to less than $0.10 in neighbouring countries. Government hopes that with the addition of some 25megawatts onto the national grid by end of this year, consumer tariffs could drop significantly.
Even with other legal and administrative hurdles that could have blocked investment cleared, energy, still remains a challenge. Rwanda generates more than 40 percent of its electricity from burning oil, which in itself is very expensive. The World Bank has indicated it will back government as it seeks more energy sources.
Experts believe that a relatively stable supply of electricity – coupled with other incentives could reduce commercial losses from 25% to 15%.
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