Rwanda Energy Situation

1. Situation Analysis

1.1 Energy situation

Rwanda‘s energy balance shows that about 85% of its overall energy comes from biomass (99% of all households use biomass for cooking),11% from petroleum products (transport, electricity generation and industrial use) and 3% from hydro sources for electricity. In 2009 about 6% of the total population had access to electricity and the government has started a roll out programme to rapidly increase this to 16% by 2012 and at least 30% by 2020. The country has currently about 65 MW installed generating capacity (hydro and diesel) but there are a number of new sources coming on line within the coming years. The economic sectors with highest potential for growth (agricultural processing, tourism, IT) depend heavily on energy supply. While larger enterprises work mainly with expensive diesel generators, most of the small businesses in rural areas have no power supply. This limits their options for expansion and hinders productivity. At the same time, due to the shortage of energy, the greater part of the social infrastructure is unable to provide services efficiently.

 Hydro sector

There are only few providers of decentralized energy systems in the country. The PSP Hydro project will provide technical and business expertise to support the creation and development of economically sustainable small and micro energy providers. This will contribute to improve the power supply in Rwanda for productive applications (small and medium-sized enterprises), as well as the social infrastructure and electricity for households. A survey in 2007 prepared a micro hydro atlas which identified about 300 sites for small and micro hydro power which can be used for minigrids or connected to the national grid, depending on the location. There have already been a number of projects implemented through the Ministry with assistance of UNIDO, BTC and EU. These are constructed under direct supervision of the ministry and once operational, will be handed over either to the national power utility or will be managed through private companies or in joint venture.

Biomass sector

Biomass (firewood, charcoal and residues) remains practically the only source for cooking. LPG consumption is extremely low (consumption per capita is 1/50 only of Kenya, the market leader in the region) while kerosene is practically only used for lighting. The Government‘s Vision 2020 asks for a reduction of biomass consumption by 50% by 2020, but is it not clear what the alternative sources of energy will be. Government programmes have focused on the increase of wood production (already 80% of the country‘s firewood and charcoal come from eucalyptus) through plantations and agro forestry programmes and to increase efficiency in charcoal production and the use of improved stoves. Already over 50% of all households have improved stoves (different models depending on the fuel used) and the Government wants to increase this percentage to 100% while at the same time improving the efficiencies of the improved stoves.

Biogas

Biogas has been introduced in the country many years ago and Rwanda has gained international recognition for its programme in the prisons and large institutions. The Government in 2008 announced a policy to introduce biogas digesters in all boarding schools (estimated at around 600 schools), large health centres and institutions with canteens to reduce the consumption of firewood. The Ministry organised in 2009 a training programme for about 25 technicians and craftsmen. No further activities are taking place as there are no funds allocated to institutional biogas in the financial year 2009/10.

Activities in the domestic biogas sector started much later. It is estimated that over 120,000 households have dairy cows that are kept under zero grazing conditions to reduce soil erosion and also due to lack of grazing areas. These numbers are increasing due to the governments programmes to increase the number of families with dairy cows. The National Domestic Biogas Programme started in 2007 with the construction of 101 pilot digesters funded by Ministry and with technical assistance from SNV. GTZ/EnDev inputs became available Jan 2008. Since that time the focus has been on capacity building, training of technicians and entrepreneurs, awareness campaigns and promotion. In total another 201 digesters were build up to 30 Sept 2009. About 30 large biogas digesters have been constructed in institutions and Rwanda has received international recognition for the biogas systems that have been installed in the prisons over the last decade reducing firewood consumption by up to 40% and improving hygienic conditions. The Government has announced a policy for boarding schools, health centres and other large consumers to install biogas systems within the coming years.

Key problems of the energy sector

The following problems are noted for the energy sector:

• 1. Access to electricity remains low and in particular so in the rural areas even if roll out plans are implemented as *scheduled. Additional efforts are required to provide electricity to those will not be close to the national grid,
• 2. Costs of new connections are at least $500/household and are beyond the reach of most households in Rwanda,
• 3. There is general a lack of entrepreneurial capacity in the country and this hampers small commercial electricity projects,
• 4. The increasing population and rising incomes per capita will result in a higher demand for cooking energy,
• 5. Government wants a reduction of the consumption of biomass (firewood/ charcoal) but there are only few alternatives such as LPG and kerosene. However, these are more expensive while electricity is no real option due to the high costs and the low connection rate.