Rwanda has been losing a whooping 272 megawatts of energy every month for the past one year following a lengthy dispute between a local company and a foreign heavy machinery supplier.
In July 2014, technicians of Energy Nyaruguru Ltd (ENNy Ltd) in southern Rwanda were surprised after reading a message displayed on machines’ screens; “License to use these turbines will expire within two weeks.” The message caused panic within the company.
The supplier of the machines activated with a code resetting the machines to non-operation mode because the local company owned him some money.
In 2005, a Rwandan nonprofit organization Adenya Nyabimata secured funding worth Rwf 300 million from German International Cooperation Agency (GIZ) to establish a power plant. GIZ advised the organization to run their energy project under an incorporated company.
Gabriel Nkurikiyimana, coordinator of Adenya Nyabimata,told KT Press they founded Energy Nyaruguru Ltd (ENNy).
Later, a Germany energy company CARERA approached Adenya Nyabimata requesting to acquire a 50% stake in ENNy. The deal was sealed. However, Carera was requested to capitalize ENNy with, $ 200,000 but didn’t respect the agreement.
Carera ordered for a turbine worth €325,000 capable of producing 250 MW of electricity. It was installed at Mazimeru waterfalls, South of Rwanda.
INGO/Kochendörfer Giersemehl an engineering firm in Germany supplied the turbine in 2011. The supplier offered Carera another similar turbine on a loan, “to help his clients produce more energy.”
Nkurikiyimana told KT Press that Adenya Nyabimata transferred Rwf 704.1 million (€894,289) onto Carera’s account, for the two turbines and accessories.
Adenya Nyabimata acquired a Rwf 500 million-loan from Bank of Kigali to begin construction and installation of the dam.
The dam with 500Kilowatt capacity was operational by May 2012 generating 272 megawatts to national grid making Rwf18 million monthly. Rwf 14,150,000 monthly was required to service the loan in ten years.
However, on October 22, 2014 the turbines stopped working. The supplier explained that ENNy owed him € 240,000.
Ananie Bizimana a Carera shareholder and current Managing Director of ENNy told KT Press “Adenya Nyabimata was confusing their non-profit organization and their commercial branch which is our partner. It’s simply a matter of misunderstanding between shareholders.”
Fabien Niyitegeka, vice mayor for Economic affairs in Nyaruguru district told KT Press, “We are concerned any time when our investors are in trouble.”
Bizimana refuted allegations that Carera did not contribute anything saying, they paid Rwf 540 million of total project valued at Rwf 1.6 billion.
He however, said Adenya Nyabimata doesn’t want to assume liability of the whole company challenges.
“We urged them to file a case to court and we hope it will be solved,” said vice mayor Niyitegeka.
Rwanda’s Infrastructure Ministry said it couldn’t get involved in a private matter but would help mediate so that the supplier can allow machines’ operation.
Bank of Kigali has set June 10, 2015 to auction the energy project including, dam, health center and school dormitories.