Monday, October 15, 2012

Rwandan Government Uses Ecological Diversity to Energize Electricity Production

ContourGlobal: KivuWatt

In 2011, Rwanda enacted a plan to generate more electricity at cheaper prices by diversifying its production methods to include domestic sources of power. Currently, Rwanda produces approximately 85 MW (megawatts) of electricity—40% of which originates from expensive imported diesel fuel and 59% from geothermal sources. As a result of Rwanda’s reliance on imported diesel, the price of electricity in Rwanda is expensive at 22 cents/kwh (kilowatt hour), compared to neighboring countries Burundi and Uganda at 8.19 and 11.22 cents/kwh, respectively.

Rwanda plans to expand its power generation to 1000MW by 2017 by utilizing inexpensive domestic biomass, methane, geothermal, and hydropower sources. Dry peat (biomass composed of an accumulation of partially decayed vegetation) is a valuable natural resource for Rwanda. A Turkish investor, Hakan Mining and Generation Industry and Trade building a 100MW peat power plant. The plant will be built along Rwanda’s southern border in Akanyaru with the goal of producing power in 3-5 years. Rwanda has enough peat to fuel that plant for approximately a hundred years if it maintains a 100MW capacity. Rwanda is also investing in a unique power plant which burns methane gas harvested from the explosive waters of Lake Kivu. The Lake Kivu project is expected to produce 100MW of power by 2014. Also, Rwanda’s nascent geothermal resources on the southern slopes of the Karisimbi volcano could generate up to 700MW of power, once they are developed in December, 2012. Last but not least, Rwanda is partnering with Burundi and Tanzania to build four regional hydro-electric plants that will generate 174MW of electricity for the Rwandan people. These domestic sources of power will produce electricity that is considerably less expensive than the diesel fuel that Rwanda currently uses.

Rwanda’s natural resources present opportunities to reduce the price of electricity by reducing the cost of generating it, but the goal to increase power supply from 100MW to 1000MW will be difficult to achieve in five years.


Anonymous said...

It's funny that Rwanda chooses to utilize other forms of generation than of the hundreds of hydro-electric opportunities that are available to them and their natural frontiers. In considering the expansion, does Rwandan government plan to continue charge the high Value Added Tax (VAT) on electricity, especially for low voltage consumers? Shouldn't the government just nationalize it's electricity generation in hopes of economic development as opposed to contracting private companies and charging a high tax for consumers? Is this really a socioeconomic advancement, or a revenue source for the government? Cui bono?

Anonymous said...

And also the price is expensive in Rwanda because of VAT as other countries such as Burundi and Uganda choose not this economic approach

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