The Government of Rwanda and the Kingdom of Netherlands yesterday signed €5 million (about Rwf4.3bn) to finance the third Energy Access and Roll out Programme (EARP3).

The money will help connect hundreds of households to reliable and cost effective electricity services, Claver Gatete, Minister for Finance and Economic planning said during the signing ceremony in Kigali yesterday.

Priority will also be given to public institutions including schools, health centres and administration units.

Gatete said access to electricity is one of the priority areas that government has identified under the second Economic Development and Poverty Reduction Strategy (EDPRS2).

"This support is expected to provide 6,500 new connections that will scale up the electrification of households, public institutions and administrative offices,” Gatete said.

The project is set to be completed by April 30 2015, Gatete added.

The ambassador of Netherlands to Rwanda, Leoni Cuelenaere, said access to electricity is very important if Rwanda is to sustain its development ambitions.

"Rwanda requires substantial energy to keep the pace of Development and attract more private sector led investments,” Cuelenaere said.

In 2005, Rwanda and the Netherlands signed a Memorandum of Understanding which set out the basis for development partnership and provided a framework for mutual dialogue and accountability.

The current Netherlands Development Programme with Rwanda is anchored on the Third Multi-Annual Strategic Plan (MASP-3) with a total of €239 million covering five years (2013-2017).

This support is divided into support that goes to Government, private sector and non-governmental organisations.

Under the support that goes to government, the Netherlands funds are allocated to the Private Sector Development and Youth Employment, Justice Reconciliation Law and Order; Decentralisation, Water and Sanitation as well as Energy.

Rwanda’s access to electricity currently stands at 22 per cent and is expected to reach 70 per cent by 2017.

Government also wants to increase its generation capacity from the current 155MW to 563MW by 2017.

Some of the energy projects expected to boost energy production are Kivuwatt 25MW, Gishoma Peat Plant (15MW) and Giggawatt Solar power plant 8.5MW, among others.