The Government of Rwanda is set to receive US $266m from the African Development Bank(AfDB) to support the country’s program to improve electricity supply and transform into an export-oriented economy.
AfDB Vice President for Power, Energy, Climate Change and Green Growth, Amadou Hott, confirmed the reports and said the funding will enable the construction of 795km of Medium Voltage and 7,317km of Low Voltage lines, which will boost nationwide connectivity and lighting up previously un-served communities.
“The approved program will support the Government to add over 193,000 new on-grid and over 124,000 off-grid connections,” said Amadou Hott, the Bank’s Vice President for Power, Energy, Climate Change and Green Growth.
The loan which is a joint amount of US $192m AfDB loan and US $74m credit from the African Development Fund, will be directed to the Scaling Up Electricity Access Program (SEAP II) in the country.
This joint amount represents 8.2% of the Government of Rwanda’s US $3.3bn budget for the Energy Sector Strategy Plan. Phase one of the program, is 90% complete after Rwanda received investment worth US $46 million in 2013
The Bank’s contribution to SEAP-II will be for the three fiscal years ending in 2021/22 and will be disbursed using the Results Based Financing (RBF) model, which ensures better risk management and a results-driven approach aligned with the activities of the Bank.
Additionally, this operation raises the Banks on-going energy portfolio in Rwanda from $184 million to US $450m, supporting eight operations three of which are being implemented jointly with neighboring states.
The Bank’s intervention has increased overall access to electricity in Rwanda from 18 percent to 44% over the last seven years.
This support will extend to the Energy Development Corporation Limited and Energy Utility Corporation Limited – subsidiaries of Rwanda Energy Group Limited, the government-owned utility which manages and operates the country’s energy infrastructure.
The SEAP II loan is aligned to the Bank’s 10-year strategy (2013 – 2022) and current Country Strategy Paper for Rwanda. It also supports three of the Bank’s High 5 priorities.