4 December 2012

Tanzania: Time Ripe for Alternative Energy Solutions

Photo: Mujahid Safodien/IRIN
Sugar cane plantation used in production of biofuel

TANZANIA'S reasons for investing in Renewable Energy now are diverse. On energy security, fossil fuels energy resources are pollutants, limited, finite and therefore not sustainable.

Countries like Japan and others, for example, depend on imported fuel risk the effects of price fluctuations and other risks of natural disasters.

On environmental concerns, utilization of fossil fuels produces carbon dioxide resulting to the global warming and air pollution. On climate change, fossil fuels utilization and the resulting emissions contribute to the change in climate in the form of higher temperatures, high rainfall and floods.

The renewable energy technology is currently a proven technology and therefore the prices compare favourably with the price of electricity produced from the fossil fuels. On job creation, the renewable energy is fast growing and therefore creates jobs in different countries unlike in the conventional energy sources which are very much centralised.

Already, the government has created a legal framework that is conducive for growth of renewable energy utilization, including the establishment of Rural Energy Agency and the Rural Energy Fund. The agency addresses the promotion of applied research, awareness raising, and promotion of renewable energy utilization in the country.

The government has also established appropriate fiscal and financial incentives for renewable energy development using the Rural Energy Fund. Import duties for most of the components of renewable energy systems were reduced from 25 per cent to only 5 per cent. Exemption of Value Added Tax on renewable energy equipment and components has been made by the government.

The challenges facing the development of renewable energy in Tanzania include high costs of alternative energy vis-à-vis affordability by the majority poor, low technological capacity for sustainable deployment of renewable energy technologies, low awareness on alternative energy sources and renewable energy technologies; inadequate investments in renewable energy, the local banks and the inaccessibility of long term loans from micro-finance institutions.

The finance institutions offer high interest rates for loans from commercial banks. The other challenges include the inadequate resources for up-scaling adoption of renewable energy technologies in Tanzania as well as the low purchasing power of end-users in the country.

The international community is also taking some measures to promote the use of renewable energy globally, following the advantages mentioned above. The resolution 65/161 of the United Nations General Assembly declared 2012 as the International Year of Sustainable Energy for All. The resolution is one of such measures in recognizing that access to modern affordable energy services in developing countries.

This is essential for the achievement of the internationally agreed development goals, including the Millennium Development Goals, and sustainable development. The use of renewable energy would help to reduce poverty and improve the conditions and standards of living for the majority of the world's population.

The initiative was announced to the General Assembly in September 2011 and the aim is to coordinate partnerships between governments, the private sector, and civil society in order to meet three interlinked objectives by 2030.

Ensuring universal access to modern energy services; doubling the rate of improvement in energy efficiency; and doubling the share in renewable energy worldwide. The governments, businesses and civil society organizations (CSOs) will take important steps to meet these objectives, but ultimately, success can only be achieved through strong, coordinated, and sustained effort by all stakeholders.

Stakeholders engagement with the Sustainable Energy for All Initiative will take certain measures such as, developing country governments to build up national plans to advance energy access, and promote efficiency and renewable energy in ways that respond to national circumstances and priorities; regional and local governments, urban planners, and transportation authorities can design policies and investments to encourage greater use of public transit, promote bicycling and walking, or heighten the adoption of alternative-fuel vehicles by investing in refuelling infrastructure.

Governments can also invest in retrofitting public buildings, which represent more than half of the total building stock and are projected to consume 40 per cent of global energy by 2030. The donors and multilateral institutions engagement will be to provide technical assistance and policy guidance, to support knowledge and capacity building, to share best implementation practices and to make direct financial investments.

The multilateral bank, for example, could work to strengthen local financial institutions in order to stimulate investment in clean energy projects while the businesses engagements will make commitments to increase energy efficiency and use renewable energy in its operations and supply chains and large international corporations can take the lead in their respective sectors.

The Financial services companies can offer guidance to governments on policies to increase privatesector investment or partner with energy service companies that share the performance and/or the credit risk.

The technology companies can undertake research and development to advance innovative technologies or adapt existing technologies to new circumstances while the civil society organizations engagements will use their flexibility, focused mission, and often times proximity to the energy poor to help communities implement sustainable energy initiatives, identifying appropriate and affordable technology, offer innovative mechanisms to lower up-front costs, and to develop business models and supply chains that attract investment.

There are also collaborative efforts to strengthen the existing initiatives of all partners, progress sustainable energy uptake, identify opportunities, and develop individual commitments and collaborative partnerships.

The Sustainable Energy for all initiative is a call to action to safeguard our collective future and therefore, all stakeholders must work together in order to achieve a broad-based transformation of the world's energy systems over the next twenty years. Even though the cost of wind power has decreased

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