Investors who seek to set up factories in Rwanda can now hear testimonies of those who are already benefitting from free connections to their industries before they surge.
REG started , effective January 1, 2019 , to waive additional investment cost through offering free of charge new connections to investors or those who want to start their business in Rwanda as a move to support the government plan to ease doing business.
REG has been performing well over the last two years, moving from 119th positions in the year 2017 to 68th last year in the energy sector in the World Bank’s doing business report released early in October.
Owners of different industries in Rwanda are lauding Rwanda Energy Group (REG) over offering them free connections that has eased their business operations in various parts of the country.
The cost for new connections is over Rwf40 millions per Kilometre including transformer for those who may set up industries.
Free transfer was installed for the factories in Jabana sector.
Andrew Bitwayiki is the owner of the concrete production factory in Jabana sector of Gasabo district that has already benefitted from the scheme.
“Because we used to connect to one transformer as many factories at once, the power was usually weak and could face outage which used to stop operations. We would stop operations for a period of over 10 days per month.
This was a huge loss considering 1,000 cubic meters of concrete we have to produce per day. I employ at least 20 workers and when they sit idle the whole day yet each is paid Rwf3,000 a day it was another big loss besides losing market for our produce concrete,” he said.
But, he said that thanks to a transformer of 400kw transformer dedicated to his factory, operations are currently sustainable.
“I applied for the service via online platform after reading REG’s announcement. They responded to our request and asked us all necessary documents of the company before coming to establish the connection three months ago,” he said.
He said that following the free connections scheme, the company is thinking of launching more business in industry sector.
He said there are two maize processing factories that rent his compound land and they also used to count losses.
“Imagine if each company rents, employs 50 workers who are paid even when operations have stop the whole day; It is a loss besides failing to supply flour,” he said
Eugene Gisagara, is the investor who is building a maize processing factory in Rwamagana district.
The project aims at adding value to maize as a way of avoiding giveaways prices paid to farmers’ maize harvest.
“The price of maize flour rarely decreases but the price for maize harvest decreased in 2016. One Kilogramme of maize could cost Rwf300 and it reduced to Rwf80 which pushed us to an idea of starting the processing factory.
Maize flour processing factories in Jabana sector are benefitting from free connections scheme by REG.
That is when we thought of value addition of maize but we faced issue of enough investment capital which had delayed the activities,” he said.
He said he submitted project to Private Sector Development Agricultural Growth project for sponsorship but it was only machinery.
However, due to lack of electricity, they resorted to install the machinery in one house in Gikondo in Kigali city for operating.
“We were still facing limited capital investment due to high cost including the cost of transformer. We needed about Rwf300 million .Connection and transformer required us to pay Rwf58 million but we got it free of charge. The support is timely,’ he said.
They applied for the support via online following REG announcement.
“The transformer has recently been established to us for free of charge in this area where were are building our factory. We are going to install the machinery and start operations,” he said.
He said his farm grows maize on over 50 hectares and the factory has capacity to process 20 tonnes of maize per day.
“There is high demand of raw materials and that is why we encourage farmers to increase maize production,” he said.
In farming activities he employs over 40 workers and 20 workers to be employed in the factory.
“Easing doing business is timely since many had failed to launch the business. The scheme is going to boost investment. I also grow fruits such mangoes, oranges and lemons. I plan to also set up factories that process them,” he said.
We have also secured machinery to set up animal feeds production factory that will be using maize bran as raw materials to feed our animals, he added.
By 2024, the target is to reach 556 MW which will enable access to electricity increase from 51% to 100%.
Government has allocated Rwf143.4 billion for energy development and access to electricity so as to increase capacity generation from 221.1 MW to 304.1 MW next year.