EAC energy security policy in the pipeline

East African Community (EAC) Partner States are in the process to formulate a comprehensive energy security policy with a view to enable the generation of affordable and reliable supply of electricity and petroleum products. This was disclosed yesterday in Kigali at the opening of a three-day regional conference on energy, which brought together participants from the five Partner States, UN representatives and other stakeholders. The meeting was convened to discuss how a common EAC energy policy can help Burundi, Kenya, Tanzania, Uganda and Rwanda better manage energy shortages. The policy framework, expected to come into force early next year, would entail a number of energy products, allow for the importation of affordable petroleum products and help the regional countries scale up their respective industrial ambitions. According to Antonio Pedro, the country-director, United Nations Economic Commission for Africa (Uneca), the absence of a common regional policy has made the countries lose out on numerous opportunities. “There is a need to master future marketing techniques to avoid sudden changes occasioned by different circumstances whether global or regional. Petroleum products were at $100 a barrel, for example previously, but because we did not hedge against any change, we did not benefit significantly in those changes, well before it happened,” he said. The projected policy is expected to help countries create reserves for at least six months, unlike in the past where many countries in the region were been used to reserves for three months. This, on the other hand, will help countries stabilise systems to deal with fluctuating prices of oil products, mostly crude oil, officials said. Participants follow proceedings at the meeting in Kigali yesterday. “The policy will help us hedge against price increases; we need to master techniques for future purposes as part of our security options,” Pedro said. As overall demand of renewable energy is increasing in the region, he said, adding that it was a timely move to consider an up-to-date common policy that would help propel the five states toward sustainable development. “There is a need to sequence investments in infrastructure to help Rwanda reduce energy deficit, import electricity, extract methane gas, and to make use of geothermal reserves, solar and/or traditional energy sources,” he added. The proposed policy is expected to have a regional master plan that will help member countries make better use of projected capacity on energy products. Rwanda seeks to increase its power capacity to 563 megawatts by 2017 from the current 160 megawatts, and field experts believe that teaming up with regional member states to design a harmonised policy will help it to hit its target. For example, Rwanda, which plans to start importing power from Kenya early next year, might find the regional policy framework suitable to negotiate more deals with Ethiopia which, in the near future, will be a top electricity producing country. “In the past 15 years, for example, there was a huge additional investment, we realised a 50 per cent or more capacity generation with regards to the plan, but an opposite situation is also true in long term planning,” said Yohannes Hailu, a regional energy policy expert. “The more we delay in planning, the more things are undertaken in a manner that does not respond to the demand pressure.” Christian Rwakunda, the permanent secretary at the Ministry of Infrastructure, said the proposed policy will help address energy related challenges in the long term. “For example, in 2009, our wood biomass energy deficit was at 21 per cent, come 2020, we will have a higher deficit, of 27 per cent; therefore, from household energy security point of view, we need to work towards a proper demand and supply balance,” he said. “This can only be achieved through stronger policies both at the national and regional level.” Rwakunda also cited ongoing national efforts to expand fuel reserves capacity from the current 30 million liters to 70 million litres by the end of 2015, and later to 200 million litres, by 2017. Earlier, Rwanda is said to have been encountering losses (not yet determined) due to unfair competition in the bloc where fuel consumers, mostly truck drivers, preferred to fuel their vehicles from Kenya or Tanzania. While pump prices in Kenya and Tanzania are below $1 (Rwf722) a litre, in Uganda, Rwanda and Burundi, a litre goes for $1, 25 (Rwf903); $1,29 (Rwf935); $1,3 (Rwf939), respectively, largely owing to transport costs and excise duties.

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EAC energy security policy in the pipeline