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Regional 147 MW hydro power project to create electricity market

Written by: Administrator
Monday, August 12th, 2019, 6:42

For regional economies to foster economic growth there is need for more investments in energy production which  tends to be costly, but with financial constraints, experts are optimistic that regional energy production would help countries pull resources together. 


There is optimism that the Ruzizi 111 hydro power plant will boost regional integration through the creation of an electricity market. The 147 MW project is shared by Rwanda, Burundi and Democratic Republic of Congo.


Accordingly, the project expected to cost between $644 million and $ 700 million is seen as yet another regional initiative to boost the development of the three economies whose energy is still a challenge compared to the recent growth mainly in  the industrial  sector.


The three countries in July signed a tripartite agreement to develop the project as a public private Partnership-PPP. The Ruzizi III Hydropower project is a joint venture of two companies namely IPS (an Agha Kan owned company) and Sithe Global replaced by SN Power (a Norwegian).


The Project is supported by many lenders who will fund the debt through concessional and commercial loans. They include World Bank, African Development Bank, European Union KfW, Agence Française de Développement (AFD), Commercial Banks and the Developer.  


“It is expected that after signing the project agreements, additional geological studies will be conducted which may result in an increase of the Project Capacity to up to 230 MW,” Rwanda’s  ministry of infrastructure revealed.


In its implementation, the project is designed as a PPP aimed at optimizing the hydropower potential of the Ruzizi cascade thus bringing out the project as the first tripartite regional energy project banked on to  boost access to electricity for the region.


This implies a private partner, acting in the capacity of investor/developer, will be recruited and awarded a concession. This partner will be required to develop the project, be a majority partner in a project company (PC) with the three countries concerned and secure the necessary financing.

The project is expected to increased supply of electricity in the region and consequently access to electricity at an affordable cost, the direct beneficiaries of which will be the population, electricity companies and businesses in the countries concerned.

Also, the creation of direct and indirect jobs during works and permanent jobs during the operational phase as well as a reduction in subsidies on fossil fuels and development of the industrial fabric for Governments while also providing an avenue for income-generating activities for women and youth; and(iv) improvement of population's living conditions.



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