The African Development Bank (AfDB) Group has approved $84.22 million in loans and grants to electrify nearly 77,470 rural households in south Rwanda.
The funding released through a project dubbed Transmission System Reinforcement and Last Mile Connectivity, is designed to advance Rwanda’s efforts of universal electrification by 2024, AfDB said in a statement, adding it would also benefit small businesses and youth.
Approved on May 26, the funds comprise a loan of $36.77 million and a grant worth $47.45 million.
Some of the activities under the project involve the construction of 595 kilometres of medium voltage distribution lines and 1,620 kilometres of low voltage distribution networks in six districts of southern Rwanda.
According to the statement, the project will also see the upgrade, rehabilitation and extension of 1,720 kilometres of low voltage network, and distribution of transformers in secondary cities with high load.
It is expected to improve the reliability and stability of power supply across the country, expand electricity access and contribute to reducing greenhouse gas emissions by enabling access to clean energy.
In addition, it is expected to bolster education by extending students' access to light for study, and benefit small and medium enterprises while enhancing job creation for youth.
The project is part of the Rwanda Universal Energy Access Program (RUEAP), which seeks among other goals, to achieve universal access to electricity by 2024.
It is also aligned with the country’s long-term development framework, Vision 2050.
The Bank said that it also draws from two of its High-5 strategic priorities: Light Up and Power Africa and Improve the Quality of Life for the People of Africa.
The funding will ease pressure on the Energy Development Corporation Limited (EDCL) which faces a serious shortfall in the national budget allocation for the 2021/2022 fiscal year.
Ron Weiss, the Chief Executive Officer of Rwanda Energy Group (REG), recently told parliament the country needs an annual investment spend of Rwf400 billion to achieve its energy goals by 2024.
Yet, he added, the money available for the coming fiscal year, which begins on July 1, is just Rwf40 billion.
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.