Tanzania to Receive USD 123 million for Power Transmission Project in Northwest

The African Development Bank (AfDB) approved on Friday 20 July 2018, a loan of USD 123.39 million to the Government of Tanzania to finance part of the country’s North- West Grid 400 kV Nyakanaz – Kigoma power transmission line project.

The project will be completed by 2024. It involves the Construction of a 280-km 400 KV transmission line from Nyakanazi to Kigoma; Extension of Nyakanazi substation and construction of a new substation at Kigoma; Integration of existing Kigoma and Kasulu 33 KV distribution networks with the main grid including supply of last-mile connection materials to serve at-least 10,000 new consumers in Kigoma Region.

The project aims to improve supply, reliability and affordability of electricity in Kigoma Region in North-western Tanzania by providing main grid access for the socio-economic transformation of the region in line with Tanzania Vision 2025.

It will increase electricity access from 16.2% to 20% in the region with over 483,000 households by 2024.

The project will lower energy production costs by decommissioning expensive diesel-powered plants in Kigoma and Kasulu urban centres including surrounding areas. In addition to enhancing job creation, the project will reduce greenhouse gas emissions in northwestern Tanzania.

Furthermore, it will complement the ongoing Bank-funded 220 kV Rusumo-Nyakanazi regional transmission line including the multinational 80 MW Rusumo Hydro Power Plant as well as other Development Partner supported energy infrastructure programmes in northwestern Tanzania.

The North-West Grid transmission line project is aligned with the Bank’s Ten Year Strategy (2012 – 2022) and the High Five priorities, especially “Light-up & Power Africa” and New Deal on Energy for Africa which aim to achieve Universal Access to Energy in regional member countries. Also, the project is in line with the Bank’s Tanzania Country Strategy Paper (2016-2020) which focuses on infrastructure development.

The project will be financed from three sources: the AfDB loan (contributing 66%), South Korea Economic Development Co-operation Fund (contributing 24%), and the Government of Tanzania (contributing 10%), for an overall cost estimated at USD186.12 million.

Tanzania Rural Electrification

According to the National Census of 2012, about 70% of Tanzanians reside in rural areas whereas only 7% of the rural population is connected to electricity supply.

This is why the Government of Tanzania plans to increase rural connection levels to 50% by 2025 and at least 75% by 2033.

To achieve these targets, more funds will be required for generation, transmission and distribution systems expansion.