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Rural Energy Agency has to incorporate key stakeholders
2005-07-06 08:34:08
By Editor
It is the fact of the day that of the country’s 34.5 million people, barely 15 per cent of it is connected to the national power grid.
That puts the country very low on the human development index, for electricity is one of the key elements in driving modern life that is full of facilities and production equipment running on electric power.
Rural areas are the most deprived of power supply, though this is not unique to Tanzania. Large parts of rural communities in developing countries are rarely connected to the national grid.
This kind of deprivation is the major roadblock towards realizing Millennium Development Goals (MDGs).
At various points in time, a number of sub-Saharan African countries have launched and accelerated the pace of the Global Program for Rural Electrification (PERG) in order to generalize rural areas access to electricity by 2007.
The government seems to have captured this line of thinking by establishing the Rural Energy Agency (REA) and its related Rural Energy Fund (REF). Preparations for setting up the institutions are almost over.
This strategy will have a major function in promoting new investment in modern energy throughout rural Tanzania.
REF will provide concessionary access to all partners and investors with viable project ideas, with training and technical assistance components in order to make good rural electrification.
As the REF is just an inch from establishing itself, strict control mechanisms need be put in place to ensure that all grants are competitively tendered hoping that any investor will get an opportunity to bid for grants for any particular project.
The combination of subsidized funds and competitive tendering will most likely lower the final cost of energy delivered to rural consumers.
However, recent concerns raised by the Tanzania Electric Supply Company (TANESCO) that REAs could duplicate activities already undertaken by TANESCO should be taken on board.
Between 2000-03, the power company spent about Tshs. 7.9 billion from its own sources to speed-up Rural Electrification Projects (REP) around the country.
Investment wisdom demands that both TANESCO and REF could easily find a common denominator in line with NEP, which aims at a pan-territorial power supply.
The launching and operationalisation of REA and REF should not engender an unnecessary conflict of interests. After all, TANESCO already has the necessary experience through its special unit, the Rural Electrification Department. This could provide guidance on achieving rural electrification.
We are suggesting the establishment of effective engagements between the twin institutions at the levels of overseeing co-ordination, monitoring and supervision of performance reviews as well as preparation of future rural electrification projects.
The concern of analysts is to avoid all sorts of ambiguities which may make it difficult for the well-intended objectives to be achieved.
The development of rural electricity infrastructure will have a positive impact on local commercial and handcraft activities.
It will also provide the necessary synergies in creating opportunities for employment as well as social and cultural programs, reducing rural-urban migration.
Successful implementation of REF goes in tandem in supporting small and medium enterprises (SMEs) in rural areas.
So, we are not only anticipating an increase in the living standards of the rural populations, but also an improvement in rural women’s conditions and rural children’s access to education.
The one caution is: The start has to be smart enough to deliver over the long run.
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