France to Lend Tanzania EUR 130M for 150MW Solar Power Plant

The French government, through its French Development Agency (AFD), has signed a financing agreement with the Tanzanian government for a concessional loan of EUR 130 million to fund the construction of a new solar power plant in the country.

The solar power plant will be located in Kishapu District in the Shinyanga Region, in the sunniest area of Tanzania, and will be the first grid-connected PV plant in the country.

It will be connected to the existing Singida-Shinyanga 220 kV High Voltage line and is expecting to produce 91,600 MWh per year and to fight against climate change by reducing CO2 emissions by 22,400 tCO2 eq/year. 

It will reach a power capacity of 50MW in the first phase of the project, and 150 MW at a later stage, to become the second-largest solar PV plant in East Africa. 

The soft loan will also finance several investments aimed at upgrading the transmission network of the Tanzania Electric Supply Company (TANESCO)–the beneficiary of the loan– to a “smart grid” to increase the level of injection of intermittent power such as solar energy.  

The deal was signed in Dodoma on 11th June 2021 by the Permanent Secretary of the Tanzanian Ministry of Finance and Planning, Mr. Emmanuel Tutuba, the French Ambassador to Tanzania Mr. Frederic Clavier, and the Resident Director of the AFD. Ms. Stéphanie Mouen Essombe.

Mr. Tutuba explained that the project will enable TANESCO to achieve its power production goals and reduce the dependence on hydroelectric power generation affected by summer droughts.

He also said that AFD provided EUR 7 million in aid for conducting a feasibility study of the project that will be implemented from March 2022 to March 2023.

For his part, Mr. Frederic Clavier said that the French Government will continue to cooperate with Tanzania in implementing various development projects to ensure the Third Five Year National Development Plan (2021/22 – 2025/26) achieves its goals.

For her part, Ms. Mouen Essombe reminded that between 2016 and 2020, France has provided more than EUR 6 billion for energy projects and that the completion of the solar-energy project in the Shinyanga region will enable TANESCO to avoid more than 43,460 tons of carbon dioxide and contribute to the French Government’s efforts to preserve the world’s environment.

The energy sector is now the Agency’s first sector in terms of commitments in Tanzania with almost EUR 400 M approved during the last 6 years. AFD is involved along with TANESCO and the Rural Electricity Agency to support access to electricity, transportation, and generation.

She also said that the AFD is preparing a new strategy to co-operate with the Government of Tanzania in implementing various strategic projects including environmental conservation and sustainable agriculture in the country.

Finally, the Executive Director of TANESCO Dr. Titto Mwinuka, said that the completion of the project will contribute to achieving the national energy goal of 5,000 MW of installed capacity by 2025 and will help to have a mix of different sources of energy since the Government’s goal is to have more energy sources including water, nuclear and solar.

Solar Power in Tanzania

Tanzania has a solar power installed capacity of just 26 MW when its total installed power capacity is 1,605.86 MW, mostly coming from gas, hydro, and petrol.

Solar resources are especially present in central Tanzania, and they are being exploited for both off-grid and grid-connected solutions.