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AfDB: ‘Electricity cost in Tanzania set to be low in the near future’

Gabriel Negatu, AfDB, DG, EA Regional Development and Business Delivery Office, said the assessment of actual drop in electricity cost is still ongoing.

AfDB: ‘Electricity cost in Tanzania set to be low in the near future’

Gabriel Negatu, AfDB, DG, EA Regional Development and Business Delivery Office, said the assessment of actual drop in electricity cost is still ongoing.

22 August 2017 Tuesday 14:56
AfDB: ‘Electricity cost in Tanzania set to be low in the near future’

By Felix Andrew

TANZANIA will experience electricity cost reduction in the medium and long term as the resources would be directed to projects on the least cost development program, the African Development Bank (AfDB) has said.

Already the government of Japan and the bank have signed a letter of intent to launch the Japan-Africa Energy Initiative (JAEI) to provide significant support to the new deal on energy for Africa which aims to achieve universal access to energy by 2025, using available energy sources and the most advanced technologies.

Speaking to Azania Post in an exclusive interview, Gabriel Negatu who is the AfDB, Director General, East Africa Regional Development and Business Delivery Office, said the assessment of actual drop in electricity cost is still ongoing.

“This initiative provides low priced concessional and non-concessional resources to tackle the huge energy sector financing gap identified new deal on energy for Africa”, he said.

The per unit cost of electrical energy is determined by many factors but of course the Japan – Africa initiative presents great opportunity for electricity cost reduction in the medium and long-term as the resources will be directed to projects on the least-cost development program and as well as supporting activities towards improving the operational performance of the energy sector as a whole.

Asked on whether the JAEI support would cover other sources of energy such as wind or renewable, he said it there are various studies to look on them.

There are studies to look on wind, solar, co-generation and geothermal; which will benefit from the JAEI (including associated transmission line infrastructure) to address both on-grid and off-grid energy access needs, he said.

In Tanzania, the main sources of electricity generation are hydro and thermal (i.e. natural gas) contributing approximately 37 percent and 63 percent respectively of TANESCO’s supply. The pipeline (short to medium term) generation projects are mostly hydro and thermal.

The Energy Access Situation Report, 2016 of Tanzania Mainland {released in February 2017 by the National Bureau of Statistics and the Rural Energy Agency (REA)} states that electricity connection at household level comprising both rural and urban areas is 32.8% (including on-grid & off-grid) and targets 50 percent by 2025.

The Japan-Africa Initiative will go to complementing AfDB and other bilateral/multilateral resources to accelerating on-grid and off-grid connection rates towards universal access.

Under the initiative, the Bank will take the lead in project development in close consultation with Regional Member Countries.

Japan stands ready to provide up to US$ 6 billion in both concessional and non-concessional finance for a variety of energy operations that will support the provision of electricity for homes, schools, hospitals, agriculture, industries and clean cooking.

The Initiative will support the full range of activities associated with public and private sector energy projects – preparation, construction and operations, through a mix of financing and technical assistance

Azania Post

Updated: 22.08.2017 15:08
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