Power connection expenses stand to be reduced up to 50 per cent if an underway low-cost design project for rural electrification, aimed at finding out a workable method for current high expenses of power installation is realized.
Addressing a media conference yesterday in Dar es Salaam, Rural Energy Agency (REA) Director General, Dr Lutengano Mwakahesya said the project, sponsored partly by the World Bank and the government, is currently on the feasibility study stage.
“At the moment, we are doing studies on engineering design, which will basically help to find out what technical expenses can be reduced, but also procurement and financing issues are studied to realize what would be the cheapest way to purchase electricity installation facilities and how electricity users would easily meet their monthly electricity charges.”
He said those three areas; engineering, procurement and financing were key issues on power supply which would provide a picture of cost-enhancing areas under the current arrangement and what alternative ways to be studied could result into cost reduction for users.
Dr Mwakahesya noted that the study would seek to answer questions like; what would be the best way to procure power equipment? Would buying such equipments in bulk reduce costs of one or another, and how far modes of procurement affect prices to the end user.
“In financing; how is the payment mode resulting into higher costs? Does the customer have to pay for all materials, like poles which eventually remain the power supplier’s property? So these are some of the key issues the said study seeks to come up with answers, for they all seem to be factors behind high pricing in various ways.”
It would therefore need positive findings from the feasibility study, scheduled to be ready by the end of December, before the actual much-desired outcome could be put on the course of implementation.
REA board chairman, Ambassador Ami Mpungwe told board members, management and workers of the agency that as young as four years as REA is, the agency had registered enormous achievements.
“When REA was officially established in October 2007, there was only 2.5 per cent of the rural population connected with electricity, and now the connection level is 6.1per cent, and this, at the end of last year,” he affirmed.
According to Mpungwe, REA has been able to supervise and finance different electricity projects at areas such as district headquarters of Kilolo in Iringa, Uyui in Tabora, Kilindi – Tanga, Mkinga – Tanga, Bahi – Dodoma, Kishapu - Shinyanga, Longido - Arusha and Rorya in Mara region.
Apart from that REA has supervised construction of wind and solar energy systems to schools, dispensaries, health centers and police posts.
The minister, William Ngeleja commended the agency saying that its performance in rural electrification had resulted in stimulating the country’s economy.
“With the kind of pace that REA is going with in achieving wide rural electrification, I am optimistic that as a country we can reach middle level income even by 2025 as electricity is one of major pillar in stocking durable growth,” he said.
Regarding the government’s plan on rural electrification, the minister reiterated that the plan to reach 30 per cent of electrification country-wide by 2015 is likely to be achieved, especially in the light of what REA has achieved in the past four years.
“A lot of people don’t understand that America which got independence in 1776 and reached a 30 per cent electrification in the 1930s, more than 150 years. It was until president Franklin Roosevelt introduced a plan like this, a low cost design project, that US electrification projects were accelerated. Now we have had 50 years since we got independence and we are working hard to make sure that we reach that goal,” he stressed.
REA director general Dr. Mwakahesya said REA was working to see the bigger portion of the 30 per cent target is directed at villages where the actual majority of Tanzanians live.