Off-grid electrification boosted
Written by: Tuyizere Daniel
Friday, July 7th, 2017, 16:32
People who live far from the national electricity grid are to be helped to have access to electricity through off-grid Renewable Energy.
This comes as the government of Rwanda and World Bank signed a $48.94 Million (about Rwf40.65 billion) scaling –up Energy Renewable Program (SREP) financing agreement to increase electricity access through off-grid technologies and to facilitate private- sector participation in renewable off-grid electrification.
The funds will help ordinary people get access to off-grid connections through loans which can easily be accessed by different financial institutions. The project aims to provide 445,500 new off-grid connections which will give about 1.8 million people access to off-grid electricity.
The consumers will use electricity for the first time and move away from expensive and harmful fuels such as diesel, kerosene, and dry cell batteries. The project will also ensure SACCOs and commercial banks gain knowledge and experience in lending to a new sector which can then support further investments.
The Rwanda Renewable Energy Fund Project will catalyze private sector investments in off-grid renewable energy access by addressing main constraints that face households and private companies in the off-grid market.
The Minister of Finance, Clever Gatete said “the objective is to increase electricity access in Rwanda through off-grid technologies and facilitate private –sector participation in renewable off-grid electrification.”
The fund which will be hosted in the Rwanda Development Bank (BRD), will allow qualified savings and Credit Co-operatives (SACCOs) and commercial banks to open local currency lines of credit to provide affordable loans to their customers both households and small businesses, for solar systems purchases.
It will also facilitate collaboration between Rwandan financial institutions and private sector like companies which are the mini grids also who are providing energy off-grid that provide solar and similar facilities for electricity to ensure quality provision of off-grid services and provide direct financing to qualified mini-grid developers.
“It is not enough to reach everybody, as there are people who live far away from grid and there are also some of the institutions including clinics, some schools that are far from the grid and need to be catered for,” Gatete observed.
To achieve this, the project will assist the government of Rwanda to establish a renewable Energy Fund (REF) which will help overcome financial barriers in scaling –up the deployment of stand alone home systems and renewable energy mini-grids in Rwanda.
Today, Rwanda stands at 33 per cent combined electricity connectivity and have set targets to achieve a 70 per cent connectivity by the end of 2018.