The government of Japan, through the Japan International Cooperation Agency, is set to provide a new grant of 2.635 billion yen ($23.653 million) to reinforce the country's capacity to avoid the risk of large-scale power outages by allowing a stable supply of electricity.
A joint JICA-Ministry of Finance statement indicates that a signing ceremony for the exchange of notes and grant agreement will be held Wednesday in Kigali.
The grant is for the third phase of what is known as the Project for Improvement of Substations and Distribution Network.
"After the achievement of Phase I and Phase II, this third phase will strengthen the capacity to avoid the risk of a large-scale power outage by enabling a stable supply of power," reads part of the statement.
Takayuki Miyashita, the Ambassador of Japan to Rwanda, and Hiroyuki Takada, the Chief Representative of JICA Rwanda Office, are expected to sign agreements with Dr Uzziel Ndagijimana, Minister of Finance and Economic Planning.
Rwanda's economy has been growing at an annual rate of approximately 8 per cent in recent years, and the country needs to keep up with the growing demand for power which is growing by more than 10 per cent annually.
The amount of power consumed in Kigali accounts for about 64 per cent of the country's total power consumption.
In contrast to that, the investment in the power distribution network has fallen short of what is needed for power consumption.
"If the investment is not boosted to a suitable level, major substations in Kigali could be overloaded. As a result, there are concerns that an unstable supply of power could become a major impediment to economic growth and daily activities of the people," the statement adds.
"It will also reduce power outage, and improve the electrification rate in Kigali, with an expected positive impact not only on the economy but also on education, health and well-being of the population."
After the achievement of the first and second phases, the third will strengthen the capacity to avoid the risk of a large-scale power outage by enabling a stable supply of power.
The implementing agency is the Energy Development Co Limited (EDCL), which will target areas in Kigali City, including some 110kV transmission lines between the existing transmission line and a planned new Gasogi substation.