Rural electrification is a key component of the government's plan to make Tanzania a middle-income country by 2025. Given the country's large size and low rural population density extension of the national grid to many isolated rural areas is not economically feasible. Tanzania estimates that about Contact online >>
Rural electrification is a key component of the government''s plan to make Tanzania a middle-income country by 2025. Given the country''s large size and low rural population density extension of the national grid to many isolated rural areas is not economically feasible. Tanzania estimates that about half the rural population may be more cost-effectively served by decentralized options than by centralized grid expansion.
"We''ve long heard that Tanzania is a regional leader in mini-grid development. Our research establishes the fact," said Estomih Sawe, executive director, TaTEDO, "As we collected data for this report, we saw how mini-grids can support schools, health clinics and small businesses in Tanzania''s rural communities. We need more information about how mini-grid development can help households across Tanzania."
In 2008, Tanzania adopted a new regulatory framework to encourage low-cost investment in mini-grids, called the small power producers (SPP) framework, which caused the number of mini-grids to double. The financial mechanism created – a feed-in tariff – was technology neutral, which favored biomass and hydro development. However, a 2015 revision to the policy encouraged solar and wind development. On June 29, 2017 Tanzania''s Energy and Water Utilities Regulatory Authority (EWURA), the national regulator, approved a third generation mini-grid framework.
"The third generation SPP and mini-grid rules represent a significant next step in our continued efforts to create an enabling environment for mini grids in Tanzania," said Eng. Godfrey H. Chibulunje, Director of Electricity, EWURA. "With explicit guidance on options for when the main grid arrives and a simplification of the licensing and registration requirements, among other important updates, we are confident that these new rules will encourage even more investment in mini-grids over the next several years."
Mini-grids have several potential benefits to rural communities: extending business hours for merchants and services; improving access to information through radios and phones; increasing school hours and study time at home; helping hospitals reduce child and maternal mortality; and supporting new enterprises like mechanical workshops and fruit processors.
"For communities across the region, a consistent and affordable supply of electricity can open new possibilities for socioeconomic progress," said Andrew Steer, president and CEO, WRI. "Mini-grids have the potential to be a transformative solution for sub-Saharan Africa as informed investors and ambitious government targets are aligning to make rapid growth possible. Now is the time to act."
The report details the location, ownership model and technologies of Tanzania''s 109 mini grids. It finds that several entities have an ownership role: the national utility (TANESCO), private businesses, faith-based organizations, communities and (in the past) cooperatives.
Also launched today, a new interactive tool, Tanzania Energy Access Maps, allows users to explore the mini-grid data alongside economic indicators in Tanzania''s regions and districts. Electricity planners in Tanzania can use the maps to identify areas best placed to benefit from mini-grid projects. Energy enterprises can use the maps to target regions with the most potential for a strong customer base.
ABOUT WORLD RESOURCES INSTITUTEWorld Resources Institute (WRI) is a global research organization that spans more than 50 countries, with offices in Brazil, China, Europe, India, Indonesia, Mexico and the United States. Our more than 700 experts and staff turn big ideas into action at the nexus of environment, economic opportunity and human well-being.
Description: Renewable, decentralised mini-grids are a promising technology for electrifying remote communities in sub-Saharan Africa. However, most mini-grids struggle not only to obtain a profit, but also to recover costs. This Policy Briefing describes the case of a private, for-profit mini-grid business model which also developed the productive commercial uses of electricity to achieve financial sustainability.
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