BMI View: The Tanzanian power sector will become increasingly diversified on the back of increased gas
and coal-fired generation, while the government seeks to decrease reliance on hydropower. Increased gas
supply from new discoveries will help to drive further investment into gas-fired capacity. Government
efforts to increase electrification rates will help boost small-scale distributed renewable energy solutions.
Latest Updates And Structural Trends
? Construction on the 240 megawatt (MW) Kinyerezi II gas-fired power plant has started in March and is
forecast to be commissioned and operational in 2018.
? The Tanzania Electricity Supply Company (Tanesco) has stated that it has plans to upgrade the Kinyerezi
I gas-fired power plant from 150MW to 335MW. We will incorporate this into our forecasts if we see
progress on the planned upgrades.
? Apart from the 80MW Rusumo Falls hydroelectric project, we do not currently expect any further
hydropower investment in Tanzania. This is as a result of the government stating that it will actively seek
to diversify the country's power sector away from hydropower by increasing its thermal power
generation. Rusumo falls will also offer Tanzania only 26.6MW of capacity, as the total 80MW is to be
split evenly between Rwanda, Burundi and Tanzania.
? The World Bank Board of Executive Directors has approved a loan of USD200mn to the Tanzanian
government for the extension of electricity grid access to a further 2.5mn households over the next five
years. The extension is being done through the Tanzania Rural Electrification Expansion Programme.
The programme will involve increasing the supply of renewable energy in rural areas.
? The China Export-Import Bank has approved the funds for the construction of a transmission line
between Dar Es Salaam and Arusha via Chalinze.