Home NewsNational Rwanda Parliament Approves €91.4M Electrification Funding 

Rwanda Parliament Approves €91.4M Electrification Funding 

by Daniel Sabiiti
5:19 pm

Rwanda parliament lower chamber

Rwanda Parliament yesterday approved an International Development Association (IDA) credit worth €91,4million to finance Rwanda’s energy sector supplemental development policy financing.

The credit will be reimbursed at an interest rate of 0.75% over a period of thirty-two (32) years, after a grace period of six (6) years.

Dr. Uzziel Ndagijimana, the Minister of Finance and Economic Planning said the proposed supplemental financing aims to mitigate the impact of the ongoing Covid-19 economic crisis on the reform program supported by IDA.

Ndagijimana, during an extraordinary parliamentary session which was opened by the speaker of the low chamber said: “The objective is to enable fiscally sustainable expansion of electricity services. The proposed operation is built around two pillars: containing the fiscal impact of the electricity sector; and improving the operational efficiency,” Ndagijimana said.

Currently the Government’s energy sector reform program aims at achieving three ambitious expansion targets of electricity generation, access while containing fiscal transfers to the sector and enhancing the affordability of electricity service for consumers.

Government’s statistics indicate that electricity access rose to 54% countrywide (39 percent on-grid and 15 percent off-grid) in February 2020, up from 40.7% in September 2017, while system losses declined from 22% to 19%.

After explaining the purpose and benefits of the IDA credit, Members of Parliament unanimously adopted and approved the law approving the ratification of the financing agreement between Rwanda government and IDA.

Rwanda has resumed construction activities on development essential projects, which include electricity generation. 

 This is expected to boost the country’s ambition to achieve universal electrification and be the first to achieve less than 50 percent reliance on traditional cooking fuels as enshrined in the National Strategy for Transformation (NST1).

The NST1 targets a generation capacity of 564 MW from the current 224.63 MW of which, still more than 15%, is generated from diesel run generators which will be replaced.

There are several power plant projects in the pipeline in Rwanda including Rusizi Hydro Power III where 147MW will be shared between DRC, Burundi and Rwanda with the latter taking a share of 49 MW.

The Rusumo’s 80 MW will be shared between Burundi, Tanzania and Rwanda which will get 27 MW.

Hakan Peat to Power Project will give Rwanda 80MW while other 50 MW will come from Symbion Methane Gas Project.

Moreover, another 40 MW is expected to be generated from other Micro or Mini-Hydro projects which are at different development stages.