2014 and the quest to achieve energy targets

The government targets, as outlined in the Energy Sector Strategic Plan, an electricity generation capacity of 563MW by 2017 and 70 per cent of the population accessing the utility. Currently, the national grid has a capacity of 137MW while 22 per cent – according to the Minister for Infrastructure, James Musoni – of the population have access to energy. This requires that in the next two years, an additional 426 megawatts be added on the national grid. The government is pursuing projects in methane, hydro, peat and solar sources. It also wants to eventually phase out thermal power. The year 2014 saw the latest addition to the national grid with 28 megawatts added after the completion of the Nyabarongo I hydro power station in Muhanga District. The $100 million dam, whose construction took close to five years, is an example of the ongoing investments and opportunities in the sector. These projects include regional and domestic projects such as 80MW Rusumo Hydro Electric Project, 147MW Rusuzi III Hydro Project, 200MW methane gas concession from Lake Kivu, potential geothermal prospects, Nyabarongo II project and other domestic micro hydro power plants estimated to generate 150MW installed capacity. The potential of the energy sector is undoubted; hydro currently constitutes the largest source of energy and is expected to remain a major source in the future. Available hydropower potential from local sites is estimated at more than 100MW. The methane in Lake Kivu is estimated to be sufficient to generate 700MW of electricity over a period of 50 years. Currently, a 4.2MW pilot plant is in operation while another 3.6MW is under construction by a local company. Another 25MW plant, owned by an international investor, is about to be completed. Potential investment opportunities exist for an additional 50MW to 100MW of power from methane. Energy generation from peat is estimated to be at least 400MW. There are plans to develop the resources to generate about 255MW of power by 2017. So far, two projects are currently under implementation, the government-funded Gishoma (15MW) peat plant and a 120MW independent power producer by a Turkish investor. Infrastructure for energy sector Having identified the shortage of infrastructure as a major constraint undermining power generation and its supply, the government has turned it into an opportunity for both local and foreign investors. The government has turned to mobilise the private sector investments. The government has taken every available opportunity to reach out to investors and experts in the sector with Rwanda Development Board, newly formed Rwanda Energy Group and the Infrastructure ministry taking lead in the efforts. Minister Musoni has been on record severally calling upon the private sector to seize the existing opportunities, and promising to ensure a conducive business environment. In his most recent appeal during the iPad Rwanda Power and Infrastructure Investment Forum in Kigali, in November, the minister noted that the government had identified the bottlenecks that inhibit businesses to thrive. “In line with the above, therefore, we are more committed than ever, to continuously improving Rwanda’s doing business environment and to attract mutually beneficial private investments in our energy sector and beyond,” he was quoted as saying. To boost the strategy, Rwanda received part of a Euro 2-billion grant alongside Cape Verde, Côte dIvoire, Liberia and Togo from the European Union that will be used to woo private investments into sustainable energy projects. Importing power Other than power generation, to further boost the country’s energy capacity, government plans to import a whopping 430 megawatts from Kenya and Ethiopia. So far, a five-year contract was inked between Kenya and Rwanda in December to import 30 megawatts. The government further signed a contract with Ethiopia laying grounds for the upgrading of Rwanda’s substations and power lines to accommodate the 430 Megawatts to be imported. The importation is expected to bring to an end power woes that local businesses have been facing. A concern regarding the capacity of the defunct Energy, Water and Sanitation Authority (EWSA Ltd) to steer the nation to the ambitions was addressed this mid this year after Cabinet approved the split of EWSA into two private companies to manage energy and water resources independently. The move saw the formation of Rwanda Energy Group (Reg) and Water and Sanitation Cooperation Limited (Wasac) with the former being in charge of power generation and supply. The newly formed Reg, being an independent private company, is expected to step in the place of the defunct EWSA that was embroiled in the mismanagement of hundreds of millions of Rwandan francs and had failed to deliver on different energy production projects. EWSA was given a ‘disclaimer opinion’ because of gross mismanagement as discovered during the auditing exercise by the Auditor-General’s office in its 2013/2014 report tabled before Parliament earlier in the year.

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2014 and the quest to achieve energy targets