The Energy Development Corporation Limited (EDCL) was allocated around 10 per cent of the funding they needed this year to generate energy in a bid to achieve the universal access to electricity by 2024, the Rwanda Energy Group (REG)’s Chief Executive has said.

Ron Weiss made the observation on Monday, May 17, while appearing virtually before the parliamentary committee on National Budget and Patrimony, as part of the ongoing hearings on sector allocations in the 2021/2022 budget framework.

With such funding deficit, some Members of Parliament said it would be impossible for the country to attain the energy target under the first phase of the National Strategy for Transformation (NST1) – a seven year Government programme that runs from 2017 through 2024.

Weiss said that electricity remains a very important pillar for development, and the most important target to reach up to 2024 is 100 per cent energy access.

"And the budget needed on annual basis by EDCL in order to implement all the needed projects to reach this target is around Rwf400 billion. But the budget available for this year (2021/2022) is around Rwf40 billion,” he said.

As of February 2021, the national electricity connectivity rate was 60.9 per cent of Rwandan households. These included 45 per cent connected to the national grid and 15.9 per cent accessing energy through off-grid systems (mainly solar), according to data from REG.

While the current targets envisage a 100 per cent access to electricity by 2024, all productive users are expected to be connected before the end of this year, according to the utility agency.

To achieve this, REG intends to increase the number of new connections by 500,000 every year, including 200,000 on-grid and 300,000 off-grid.

Overall, REG was allocated over Rwf101 billion in 2021/2022 compared to Rwf124 billion in the 2020/2021 revised budget. REG consists of two entities – the EDCL and Energy Utility Corporation Limited (EUCL). This amount will be used for different purposes including paying salaries for the REG staff, energy generation and distribution, among others.

EDCL Managing Director, Félix Gakuba, said that the energy sector budget allocation has been going down since 2018, reaching the record low in 2021/2022 yet, as 2024 nears, more efforts are needed so as to achieve the universal energy target.

"There is a huge funding gap to achieve the number of new [electricity] connections and hit 74 per cent [access to electricity] in the next fiscal year. That requires efforts,” he said.

MP Christine Bakundufite said that the budget allocated to REG should be reconsidered given the national electricity goal.

"The budget allocated to REG is too small...if such a budget is used, it cannot help us achieve the energy access we want,” she said.

However, Rehema Namutebi, the Director General of National Budget at the Ministry of Finance and Economic Planning, said that limited resources have been a financing challenge as the country grapples with effects of Covid-19.

She, however, said that there are other avenues to bridge the funding gaps, saying that the utility agency still has access to external financing such as grants and loans.