The Government and the European Union, yesterday, signed a financing agreement worth €177 million (about Rwf157 billion) to support the energy sector for the next five years.

The financing agreement is the first of a series to be signed in the coming months as part of a €460 million programme of EU grant financial assistance to Rwanda agreed in 2015.

The money will help Government improve the supply, transmission and distribution of electricity in Rwanda, Amb. Claver Gatete, the minister for finance and economic planning, said.

It is also planned to boost management of the energy sector and raise citizens’ access to energy.

"Energy is one of the top priorities for the Government of Rwanda and access to modern energy for a major part of the Rwandan population and the development of its productive activities is a prerequisite for the achievement of our development goal of becoming middle income country by 2020,” Gatete said.

Rwanda’s installed power generation capacity stands at 186 megawatts, against a target of 563 megawatts by 2018.

According to the State Minister for Energy, Water and Sanitation, Germaine Kamayirese, the Government has designed a new energy policy seeking to enhance transmission, reliability and affordability of power across the country.

Meanwhile, the Head of the EU Delegation to Rwanda, Amb. Michael Ryan, said the assistance will continue to focus on strategic areas, including energy, agriculture, and good governance.

This will translate into increased productivity, poverty reduction and help propel the country towards becoming a middle income economy; Amb. Ryan said, adding that the EU’s commitment to Rwanda’s long term prosperity and stability is unshakeable.

"This €177 million grant for energy will help improve access to energy, particularly for those in rural areas. 2016 is an important year for the EU in Rwanda. We will be signing several more such financing agreements, including a €200 million grant to agriculture – this will be our largest single financial operation in Rwanda to date,” he said.

In September 2014, the European Commission and Rwanda signed the 11th European Development Fund (National Indicative Programme), worth €460 million, which runs until 2020.

At least €200 million is being used to suppert of the energy sector.

The funding is a huge boost to what Government had allocated to the sector (Rwf135 billion) this financial year.

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