The 6th Government of Rwanda and Development Partners Annual Conference KIGALI, 22-23 November 2006: Near and Medium - term plans for Energy and Economic Growth Eng. Albert Butare Minister of State in charge of Energy and Communications RWANDA
EDPRS: General objective To improve the quality of life of all Rwandans NB! Energy appears to be a prime mover of all sectors that contribute to improving the quality of life of the people
Energy: Sectoral interventions Private sector led growth Modernising agriculture Quality healthcare Quality education Gender: reduce work load for women etc.
Energy Status 95% of energy source remains biomass Access to electricity still low: 70.000 households connected (6% of population) Supply can not meet demand (shortage: 35%; 50% at peak hours) Tariff: One of the highest in the world (22 Usc/kWh) Demand growth: About 25% per year Negative impact on economic growth!!!
Electricity supply shortage attributed to: • Under-investment in the sector for 25 years; resulting into insufficient generation, high system losses (technical and commercial) • Drastic generation drop from 2003 – 2006 • Hydro generation drop by over 65% (irregular rainfall; increased agricultural activities, increased deforestation, economic growth demanding increased electricity supply) • Thermal generation shoots from 0 to 140 GWh!! This happens when oil prices have just increased by 100%
PROGRESS since DPM 05: General • Less load shedding / 5MW extra rental power • Differentiated tariff structure in favour of industrial category • Electricity and water utility locally managed with sourced technical assistance in key areas
SITUATION since DPM 05 cont…. Electricity generation • Bidding process for Heavy Fuel Oil power Generation completed, Generators up and running by Nov 2007 • KP1-methane: Pilot plant expected to flair gas out in Feb 2007 • Construction of 9.5 MW Rukarara mini-hydro commencing (works to be completed in 24 months) • Construction of 21 micro-hydro plants (about 10 MW) commencing under different schemes.
SITUATION since DPM 05: Electricity generation cont... • Bidding for Nyabarongo hydro-power plant (27.5 MW) in process • Feasibility studies for another 10 micro-hydro plants (about 6 MW – under the Belgian Govt support) commencing • Installation of 1 MW solar pv in partnership with a German group in good progress
SITUATION since DPM 05: Energy Efficiency mechanisms • Under the WB UERP, procurement of 400,000 CFLs in process; saving of about 15 MW at peak hours expected. • Request for tax reduction made to Govt on invertors for use in tea factories, as well as solar –pv (lighting) and -thermal (water heating) for the same energy saving purposes.
SITUATION since DPM 05: Other initiatives (Biomass, wind, geothermal..) • Improved cook stoves scheme (100% usage by Households and Institutions) • Improved methods of charcoal production underway • Studies on peat exploitation launched • Studies on wind potential ongoing • Studies on geothermal exploitation ongoing
Very, very important to note! • Increased donor coordination along lines of EDPRS and Aid Policy allignment • Increased interest from Private investors (number of MoUs signed) • Increased interest from DP in energy sector (WB, AfDB, EU, NL, BE) • Capacity issues within the Ministry (Mininfra) being systematically addressed
ENERGY: Near term impact? • Solid plans, including procurement plans • Sufficient energy supply – time line............... (unfortunately energy is not an off shelf commodity) • Real impact (from all the initiatives) will be felt mid 2008 ... Patience!!
Where do we want to go? Next steps! PURPOSE (EDPRS): • Increase supply • Rationalise demand • Reduce tariff
Indicators? • Increased access to electricity • From 6% to 15% (by 2011) • From 70.000 to 225.000 households (by 2011) • Reduced tariff: from 22 Usc/kWh 10 Usc/kWh (by end of 2008)
Path to reach there!!EDPRS..... • Institutional reform i. Implementation of sector policies • Mininfra, RURA, ANER • Policy on Rural Electrification • Capacity building within Mininfra and its agencies ii. Focus on planning, Monitoring and Evaluation • Approval of Master Plan for Electrification • Action Plans, MTEF • Efficient budget execution (absorption capacity)
Path to reach there!!EDPRS..cont... 2. Research and Development 3. Sector Regulation • Laws • MoUs / Contracts (IPP; PPP; BOT; BOO)
Path to reach there!!EDPRS..cont... 4. Improve energy infrastructure • Increase production from 44MW to 114MW produced electrcity (hydro, methane, thermal, wind, solar, peat, geothermal) • Percentage of institutes have access to electricity (schools, health centers, administration) 5. Rationalise energy use • Energy efficient lamps (save 15MW) • Improved cook stoves for 100% of households
Rapid diagnostic of potential sites will be carried out in coming months (financing by Belgium) A great number of development partners are interested in investing in micro hydro power (Belgium, Netherlands, AfDB, WB, GEF, UNIDO, EC). It is to be expected that the financing of over 40 sites will be secured in months of 2007 GoR is now signing a contract for 8 micro hydro power plants (5.6MW), of which 2 will be grid connected. INVESTMENT NEEDS– cont….MICRO HYDRO POWER
Supply of improved stoves to all households and institutions in the country. Training and adaptation of improved methods of charcoal production to all charcoal markets in the country Biogas (construction digesters) Carbonization and utilization of peat in institutions to substitute fuel wood. Solar energy supply in districts and sectors (priority areas to be identified) INVESTMENT NEEDS– cont…..RURAL ENERGYSolar, wind, wood, biogas, peat, geothermal energies
INVESTMENT NEEDS– cont…….TRANSMISSION AND DISTRIBUTION • Rehabilitation existing grid lines • Monitoring of electricity system (scada system using fiber optic cables) • Construction of new lines
INVESTMENT NEEDS - cont…Institutional reform • National Energy Agency (ANER): to implement projects • Recruitment of international and local experts in Mininfra • More focus on planning and procurement in Mininfra • More attention to donor coordination
SUMMARY OF INVESTMENTS NEEDS (2007-2009) • Power generation (70MW) 150m USD • Transmission and Distribution 100m USD • Rural Energy 80m USD • Capacity Building 3m USD • Energy Efficiency 10m USD • Institutional Reform 5m USD → FINANCING GAP OF 40% – 50%
INVESTMENT NEEDS for 2007… figures? Mini and large Hydro power Plants Rukarara (9.5MW) $20.0m GoR Nyaborongo (27MW) $ 70.0m GoR/PPP Rusizi II (rehabilitation) $ 4.4m Regional (EU) Rusizi III (study, 70MW) $ 5.0m (Regional -EU) Rusumo (study, 60MW) Regional (WB, AfDB, etc)
INVESTMENT NEEDS – cont.Other power generation sources • Methane gas (35MW) $ 70m GoR/DAL • HFO generators (20MW) $ 20m WB/GoR • Rental power (15MW) $ 12,5m GoR
CONCLUSION Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership, Partnership,
Otherwise… Prepare to receive ........... ENERGY REFUGEES!!!!
THANK YOU FOR YOUR KIND ATTENTION