4 April 2018

Tanzania: Mammoth Power Project to Kick Off Soon - Govt

Dar es Salaam — Implementation of the Stiegler's Gorge Power Generation Project, which will more than double Tanzania's electricity production capacity by 2021, will kick off in the next three months.

The Stiegler's Gorge project and the remaining phases of the Kinyerezi gas-fired power generation projects as well as similar schemes in Mtwara will produce a total of 3,780MW for Tanzania.

That will bring the country's total installed capacity of electricity generation to 5,293.3MW, the Minister of Energy, Dr Medard Kalemani, said yesterday.

Currently, the country's installed power production capacity stands at 1,513.3MW, while actual electricity demand stands at 1,400MW. Speaking ahead of the commissioning of the Kinyerezi II power generation project yesterday, Dr Kalemani said the Stiegler's Gorge Power Generation Project will be implemented in 36 months.

The project will see the construction of the largest dam in Tanzania along the Rufiji River in Selous Game Reserve. The hydropower project will have an installed capacity of at least 2,100MW.

"Currently, the ministry is finalising the process to pick the contractor for the project. The ministry is also building relevant infrastructure that will simplify the implementation of the project," he said.

Infrastructure projects being undertaken include connecting the area with electricity and roads.

"The aim is to ensure that once the winner is announced, the contractor should start implementing the project immediately. It is our hope that the project will be completed by early 2021," he said. According to him, the Stiegler's Gorge power generation project will end Tanzania's power woes and sustain local industries with electricity and enable the country sell surplus power to neighbouring countries. Speaking during the commissioning of the Kinyerezi II Power Project, President John Magufuli reiterated that the contractor for the project will be picked soon.

"The Minister of Finance and Planning has assured me that the money for implementing this project has been set aside. Once the contractor has been picked, the country will issue advance payment without delay," he said.

Although the country has made commendable achievements by increasing power generation to 1,513.3MW, the amount was still too small for a country that is building an industrial-based economy, Dr Magufuli said.

The Head of State invited investors interested in cooperating with the country in implementing power generation projects, saying the country has many untapped power projects opportunities, including coal and nuclear energy.

"But they should be ready for a win-win partnership. Investments that will require the country to pay capacity charges have no place in Tanzania," he warned.

He cautioned the Ministry of Energy and Tanzania Electric Supply Company (Tanesco) to start addressing challenges in production, transmission and distribution systems, noting that it was time power tariffs were subjected to review.

"High prices are due to the country's reliance on oil for power generation, but after completion of these projects, electricity prices should be reviewed to enable the country compete with other countries in terms of investment attraction," he noted.

Also, he called upon the ministry and the Rural Energy Agency (REA) to increase power connection speed and ensure that the 7,873 villages out of 12,268 are connected immediately.

Earlier, Tanesco's managing director Tito Mwinuka said a total of 167.82MW has been added to the national grid following the commencement of Kinyerezi II power plant.

Providing the background of the project, Dr Mwinuka said the project costs reached $344 million equivalent to Sh758 billion funded through a soft loan from Sumitomo Mitsui Banking Corporation and the Japan Bank of International Corporation (JBIC).

"While the country secured a soft loan amounted to $292 million, the Tanzania government has dished $51.6 million equivalent to Sh120 billion to the project implemented by the Japanese contractor Sumitomo Corporation," he said.


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