RENEWABLE ENERGY RESOURCES

Prepared by:

Kaare MANYAMA JACOB

Master of Science in Energy Engineering

15th DECEMBER 2016

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 TABLE OF CONTENT

TABLE OF CONTENT ................................................................................................................... i

LIST OF FIGURES ....................................................................................................................... iii
ABBREVIATIONS AND ACRONYMS ...................................................................................... iv
INTRODUCTION .......................................................................................................................... 1
CHAPTER ONE ............................................................................................................................. 2
COUNTRY CONTEXT.................................................................................................................. 2
1.1 GEOGRAPHY .......................................................................................................................... 2
1.2 POPULATION ......................................................................................................................... 3
1.3 ECONOMY .............................................................................................................................. 4
1.4 IMPACT OF CLIMATE CHANGE ......................................................................................... 4
CHAPTER TWO ............................................................................................................................ 6
ENERGY SECTOR PROFILE ....................................................................................................... 6
2.1 ENERGY SECTOR DESCRIPTION ....................................................................................... 6
2.2CURRENT STATUS OF ELECTRICITY SECTOR ............................................................... 8
2.3 ELECTRICITY DEMAND ...................................................................................................... 9
2.4ELECTRICITY DISTRIBUTION ........................................................................................... 10
2.5 DOMESTIC ENERGY ........................................................................................................... 10
CHAPTER THREE ...................................................................................................................... 11
RENEWABLE ENERGY RESOURCES..................................................................................... 11
3.1 SOLAR ENERGY .................................................................................................................. 11
3.2 HYDROPOWER .................................................................................................................... 12
3.3 BIOENERGY ......................................................................................................................... 13
3.4 WIND ENERGY .................................................................................................................... 14
3.5 GEOTHERMAL ENERGY .................................................................................................... 14
3.6 OCEAN ENERGY.................................................................................................................. 15
CHAPTER FOUR ......................................................................................................................... 17
EXISTING RENEWABLE ENERGY TECHNOLOGIES .......................................................... 17
4.1 INSTALLED PV PLANTS AND CAPACITIES .................................................................. 17
4.1.1 PV SOLAR HOME SYSTEMS ....................................................................................... 18
4.2 INSTALLED SOLAR THERMAL PLANTS AND CAPACITIES ...................................... 18
4.2.2 SMALL-SCALE SOLAR THERMAL SYSTEMS ......................................................... 19

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4.3INSTALLED WIND TURBINES AND CAPACITIES ......................................................... 19
4.3.1 WIND TURBINES FOR WATER PUMPING ............................................................... 20
4.4 INSTALLED GEOTHERMAL PLANTS AND CAPACITIES ............................................ 21
4.5 INSTALLED BIOENERGY POWER PLANTS AND CAPACITIES.................................. 22
CHAPTER FIVE .......................................................................................................................... 24
RENEWABLE ENERGY DEPLOYMENT DRIVERS AND BARRIERS ................................ 24
5.1 DRIVERS ............................................................................................................................... 24
5.2 BARRIERS ............................................................................................................................. 24
CONCLUSION ............................................................................................................................. 29
REFERENCES ............................................................................................................................. 30

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 LIST OF FIGURES

Figure 1.1: Map of the United Republic of Tanzania .............................................................. 3

Figure 1.2: Population Projections to 2035 ............................................................................. 4
Figure 1.3: Melting snow of Mount Kilimanjaro in Tanzania ................................................ 5
Figure 2.1: Institutional Framework and Market Structure of the Electricity Sector. ............. 7
Figure 2.2: Share of total Primary energy Supply in 2015 ...................................................... 9
Figure 3.1and 3.2: Small Scale Solar Lanterns ................................................................... 11
Figure 3.3Tanzania Large Hydropower Stations ................................................................... 12
Figure 3.4: Distribution of Geothermal Prospects. ................................................................ 15
Figure 4.1: Iringa (Tanzania) Farm Solar Water Pumping Installation ................................ 17
Figure 4.2: Installed water heater system .............................................................................. 19
Figure 4.3 and 4.4: installed wind turbine at Singida (Tanzania).......................................... 20
Figure 4.5 and 4.6: Ngozi area (Mbeya) for geothermal project ........................................... 22
Figure 4.7 and 4.8 Sisal Biogas plant in Hale-Tanga (Tanzania) .......................................... 23

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 ABBREVIATIONS AND ACRONYMS

AMR - Automatic Meter Reader

CHC Consolidated Holding Corporation
DBSA - Development Bank of Southern Africa
EWURA Energy Water Utility Regulatory Agency
FELISA - Farming for Energy for Better Livelihoods in Southern Africa

JBIC - Japan Bank for International Cooperation

JICA - Japan International Cooperation Agency
KCPL - Kiwira Coal and Power Limited
MEM - Ministry of Energy and Minerals

NEP-National Energy Policy

NORAD - The Norwegian Agency for Development Cooperation

POS- Point of Sale,

PV - solar photovoltaic

REA Rural Energy Agency

REF - Rural Energy Fund

TANESCO Tanzania Energy Supply Company

TGDCL - Tanzania Geothermal Development Company Limited
TPDC Tanzania Petroleum Development Corporation

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 INTRODUCTION

This report consists of all Renewable energy resources in Tanzania. Chapter one that is named as
the context covers the Tanzania country profile whereby The United Republic of Tanzania is a
country that shares border with Kenya to the North, Uganda, Rwanda and Burundi to the
Northwest, the Democratic Republic of Congo to the West, Zambia, to the Southwest, Malawi
and Mozambique to the South and the Indian Ocean to the East. The total area is 947,300 square
kilometers with the population of 53,470,420, life expectancy in Tanzania is: Male 59.9, female
63.8 and total life expectancy is 61.8. The country experiences a mean annual rainfall varying
from below 500 mm to over 2500 mm annually, largely depending on altitude.

Chapter two covers the energy sector profile where Tanzania is blessed with abundant
indigenous renewable energy resources such as hydro (estimated at 4.7 GW), natural gas (proven
reserves at 53.28 TCF8, composed of deep sea at 45.28 TCF and onshore at 8 TCF), solar
radiation (187 W/M2), wind with an average speed 10 m/s, coal reserves (estimated to 1,200
million tonnes, out of which 304 million tonnes are proven), uranium, biomass, and geothermal
which is estimated to generate about 650 MWe. Estimated total energy consumption is more than
54 million tonnes of oil equivalent (MTOE) or 1.102 TOE per capita. The primary energy supply
depends mainly on biomass the overwhelming majority of households use wood and charcoal for
cooking. More than 80% of energy delivered from biomass is consumed in rural areas; heavy
dependence on biomass as the main energy source contributes to deforestation, while the
importation of oil costs about 25% to 35% of the nations foreign currency earnings.
Chapter three and Four Existing Renewable Energy Technologies in Tanzania as well as drivers
and barriers respectively, l Tanzania is endowed with diverse renewable energy resources,
ranging from biomass and hydropower to geothermal, solar and wind. Much of this potential has
not been fully exploited. If properly utilised, such renewable resources would contribute
signifiantly to Tanzanias energy supply, thus moving the country closer to achieving middle-
income status, as envisioned in the Tanzania National Development Vision 2025. Recognising
the potential contribution of renewable energy to the countrys future energy mix, the
Government of the United Republic of Tanzania is committed to foster the development of low-
carbon energy initiatives, by harnessing the countrys renewable-energy resource base.
Renewable sources of energy, which are environmentally benign, can be utilized to improve
access to sustainable, modern and cleaner energy services. Deployment of renewable energy
technologies has the potential to contribute to job creation, income generation and the improved
livelihoods of marginalised social groups, particularly women and children in rural area

Renewable Energy is a great opportunity in Tanzania but it encounters several barriers related to
institutional or policy issues, knowledge and capacity gaps, and economic and financial factors.
Got, with support from development partners, is developing mitigation measures that include
better planning tools and effective policy reforms, strengthening of institutional and human
capacity, and financial incentives.

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 CHAPTER ONE

COUNTRY CONTEXT

1.1 GEOGRAPHY

The United Republic of Tanzania lies south of the Equator between latitudes 10S and 120S
between longitudes 300E and 410E. It is located between the Great Lakes of Victoria, Tanganyika
and Nyasa. It shares borders with Kenya to the North, Uganda, Rwanda and Burundi to the
Northwest, the Democratic Republic of Congo to the West, Zambia, to the Southwest, Malawi
and Mozambique to the South and the Indian Ocean to the East. (INC Report, 2003)
The total area is 947,300 square kilometers with the Mainland covering 939,702 square
kilometers. The land area of the mainland is 881,289 square kilometers while 58,413 square
kilometers are inland lakes. The available land for cultivation is 40 million hectares and
cultivated land is about 5.2 square kilometers. Forests and woodland occupy 50 percent of the
total area and 25 percent is wildlife reserves and national parks. The coastline extends 800
kilometers from 40S to 100S. Except for the coastal belt most of the country is part of the Central
African plateau lying between 1,000 to 3,000 meters above sea level. (INC Report, 2003)

The country has a great diversity of climatic conditions with annual mean temperature ranging
from a mean daily temperature of between 240C 340C. Within the plateau, mean daily
temperatures range between 210C - 240C while in the highland areas temperatures range from
150C - 200C.

The country experiences a mean annual rainfall varying from below 500 mm to over 2500 mm
annually, largely depending on altitude. Rainfall in Tanzania is of two regimes, some parts of the
country receive bimodal rainfall, long rains during the months of March to May and short rains
during the months of October to December. Other parts experience a uni modal rainfall pattern
whereby most of the seasonal rainfall is during the months of December to April. In both
patterns there is a long dry season from May to October. The hottest months are December to
February and the coolest months are June to August. (INC Report, 2003)

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 Figure 1.1: Map of the United Republic of Tanzania

1.2 POPULATION

Tanzania has total estimated population of 53,470,420 (2015 figure). The current rate of
population growth is 2.9 percent per year. If this trend continues, the population will reach 64
million by 2025 and 83 million by 2035(Energypedia, 2016), According to the latest WHO data
published in 2015 life expectancy in Tanzania is: Male 59.9, female 63.8 and total life
expectancy is 61.8 which give Tanzania a World Life Expectancy ranking of 152. Major causes
of Death in Tanzania include HIV/AIDS, Influenza and Pneumonia, Stroke, Coronary Heart
Disease, Diarrhea diseases, Diabetes Mellitus, Malaria, Prostate Cancer, Cervical Cancer,

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Malnutrition, Road Traffic Accidents, Maternal Conditions, Liver Disease, Endocrine Disorders,
Kidney Disease, Hypertension, Tuberculosis and Lung Disease. (WHO, 2015)

However, the growth rate is expected to slow as economic development progresses. Today about
three-fourths of Tanzanians live in rural areas; by 2035, it is projected that urban populations will
have increased, although rural ones will still constitute the majority of residents.

Figure 1.2: Population Projections to 2035

Source: United Nations Department of Economic and Social Affairs 2012.

1.3 ECONOMY

The economy of the country heavily depends on agriculture, which accounts for 42.5% of GDP,
provides 70% of exports, and employs about 75% of the work force. Industry accounts for 18.9%
of GDP and is mainly limited to processing agricultural products and light consumer goods. The
services sector (tourism, transport, energy and mining) accounts for 38.6%. The real GDP
growth rate is about 7% (2013) and has been maintained over five years consecutively while
current GDP is about US $ 44.90 billion and annual GDP per capita is US $6943. The literacy
rate is about 60% and 75% for female and male, respectively. (Pre Assessment Report, 2015)

1.4 IMPACT OF CLIMATE CHANGE

In Tanzania, climate change has also been observed. For example, a mean annual temperature
increase of 100C has been recorded since 1960 and rainfall decreased at an average rate of 2.8
mm per month and 3.3% per decade. More decrease in rainfall occurred in southern part of
Tanzania. It is predicted that extreme events such as drought, floods, tropical storms and
cyclones are expected to become more frequent, intense and unpredictable in future. Other
adverse effects will include negative impacts on food production, energy and water supplies, as
well as a decrease in the population health, particularly in rural households which represent the

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majority of the countrys inhabitants. In turn the negative impacts of climate bring about socio-
economic impact on people especially in poor farming communities. (Mbilinyi, 2013)

Droughts have recently affected the country and undermined its hydroelectric capacity, while the
world famous glacier on top of Kilimanjaro Mountain is disappearing at an impressive speed.
According to the UNDP Climate Change Profile, temperatures are forecasted to rise between
1.50C to 4.50C by 2090, and rainfall is expected to increase in areas with two wet seasons and
decrease in the centre and south of the country. (UNDP, 2010)

Figure 1.3: Melting snow of Mount Kilimanjaro in Tanzania

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 CHAPTER TWO

ENERGY SECTOR PROFILE

2.1 ENERGY SECTOR DESCRIPTION

The energy sector in Tanzania is largely dominated by biomass, accounting for 88% of a total
20.7 million tons of oil equivalent (MTOE) of the total primary energy supply in 20117. Fuel
imports reached1.6 MTOE and represented 32% of total imports to the country8. In 2011, energy
consumption per capita was 0.48 tons of oil equivalent (TOE), one of the lowest rates in the
world and only two-thirds of the average consumption in sub-Saharan African developing
countries.

The residential sector accounts for most of the energy used, the vast majority of which consists
of biofuels and agricultural waste; 80% of biomass used in the residential sector is for household
cooking, with about half of annual charcoal consumption occurring in Dar es Salaam. Petroleum
products comprised 8.1% of total final consumption, whilst electricity accounted for just 1.9%.
Only about 36% of the countrys population has access to electricity in 2014. Some obtain access
through stand-alone solar photovoltaic (PV) systems and mini-hydro grids operated by local
NGOs and faith-based groups. The first few privately run, mini- and micro-grids have emerged
in response to the enabling financing and regulatory framework that government has put in place.
Private diesel generators are, in part, meeting significant pent-up demand.

Structure of the energy sector

Tanzanias energy sector comprises various stakeholders, including national institutions, private-
sector operators and NGOs. At present, the system is divided in two segments, the national
interconnected grid and the zones under REAs responsibility (consider Figure 2.1)
In already served zones, TANESCO operates as a vertically integrated utility that, in addition to
its own generation resources, acts a single buyer from IPPs or SPPs and sells to its own
customers. In the zones under REAs responsibility, SPPs may sell power directly to customers.

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 Figure 2.1: Institutional Framework and Market Structure of the Electricity Sector.

Ministry of Energy and Minerals (MEM)

The MEM is responsible for developing and reviewing Government policies related to electricity
supply and distribution, including electrification of rural areas. The MEM guides TANESCO and
the REA on the preparation of electrification plans, leads the development of the energy sector,
and takes all necessary measures to organize the industry and create conditions to enable
sustainable and efficient performance of the sector.

Energy and Water Utilities Regulatory Authority (EWURA)

EWURA was created under the EWURA Act in 2001. However, it became operational only in
2006. EWURA is responsible for the regulation of four sectors which are electricity, water,
transport, and distribution of petroleum and natural gas. EWURAs core functions are licensing
or regulating access to the market, tariff setting, and establishing and monitoring technical
standards that promote quality and reliability in electricity service provision

Tanzania Electricity Supply Company (TANESCO)

TANESCO is the state-owned, vertically integrated national utility, responsible for electricity
generation, distribution, transmission, and sale of electricity to the Tanzanian mainland and bulk
power supply to the island of Zanzibar. TANESCO takes the lead in the implementation of urban
electrification and, at the same time, assumes responsibility for the supervision, quality
assurance, performance, evaluation, and infrastructure commissioning related to the rural
electrical infrastructure (the construction of which is procured by the REA).

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 Rural Energy Agency (REA)
Rural Energy Agency (REA) is an autonomous body under the Ministry of Energy and
Minerals of the United Republic of Tanzania. Its main role is to promote and facilitate improved
access to modern energy services in rural areas of Mainland Tanzania by working in partnership
and collaboration with private sector,Non-Governmental Organizations, Community Based
Organizations, and Government agencies
REA became operational in October 2007; the main functions of REA are the following.
Promote, stimulate, facilitate and improve modern energy access for productive uses in rural
areas in order to stimulate rural economic and social development.
Promote rational and efficient production and use of energy, and facilitate identification and
development of improved energy projects and activities in rural areas.
Finance eligible rural energy projects.
Prepare and review application procedures, guidelines, selection criteria, standards and terms
and conditions for grants allocation.
Build capacity and provide technical assistance to project developers and rural communities.
Facilitate preparation of bid documents for rural energy projects

2.2 CURRENT STATUS OF ELECTRICITY SECTOR

Tanzania has abundant indigenous energy resources such as hydro (estimated at 4.7 GW), natural
gas (proven reserves at 53.28 TCF8, composed of deep sea at 45.28 TCF and onshore at 8 TCF),
solar radiation (187 W/M2), wind with an average speed 10 m/s, coal reserves (estimated to
1,200 million tonnes, out of which 304 million tones are proven), uranium, biomass, and
geothermal which is estimated to generate about 650 MWe. Estimated total energy consumption
is more than 54 million tonnes of oil equivalent (MTOE) or 1.102 TOE per capita.

Tanzanias energy supply depends mainly on biomass. Since about 85% of the population is not
connected to the electricity grid, the overwhelming majority of households use wood and
charcoal for cooking. More than 80% of energy delivered from biomass is consumed in rural
areas; heavy dependence on biomass as the main energy source contributes to deforestation,
while the importation of oil costs about 25% to 35% of the nations foreign currency earnings.

About 50% of the population lives in poverty, out of which 35% is unable to access all of the
basic needs including energy services. Available data reveals that the poor spend about 35% of
their household income on energy while the better off spends only 14%. Lack of access to
modern energy services creates a vicious cycle of poverty for rural communities due to continued
limited production opportunities and social facilities. (GTZ, 2007)

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 2.4% 1.2% 0.3%

7.8%
Biomass
Petroleum
Natural Gas
Hydropower
88.3%
Coal

Figure 2.2: Share of total Primary energy Supply in 2015

2.3 ELECTRICITY DEMAND

Tanzania is endowed with diverse forms of energy resources including natural gas, hydro, coal,
biomass, geothermal, solar, wind and uranium which have not been optimally utilised. As of
May 2014, Tanzanias total installed generation capacity was 1,583 MW composed of hydro 561
MW (35 percent), natural gas power plants of 527 MW (34 percent) and liquid fuel power plants
of 495 MW (31 percent). Tanzania electricity Supply Company (TANESCO) also imports power
Uganda (10 MW), Zambia (5 MW) and Kenya (1MW). Due to traditional dependence on
hydropower, the droughts that occurred in 2010 resulted in power supply shortages in the
country. To bridge the electricity supply gap in the country, in 2011, TANESCO contracted
Emergency Power Producers (EPP) which is relatively expensive, about 24 percent of the
Mainland Tanzanian population is connected with electricity services of which 7 percent is in
rural areas.
Demand for electricity is on average growing between 10 percent and 15 percent per annum. To
achieve the desired socio-economic transformation, Tanzania aims to increase connection levels
to 30 percent by 2015, 50 percent by 2025 and more than 75 percent by 2033. This requires
significant investment in generation, transmission and distribution systems
At the present, the energy balance in Tanzania is dominated by traditional use of biomass in the
form of charcoal and firewood. About 70 percent of the Tanzanian population lives in rural areas
and depends on agriculture activities. The Agricultural sector contributes about 50 percent of the
national GDP. At the present 24 percent of the Tanzanian population are connected with
electricity. Only about 11 percent of the rural population is connected with electricity services.

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2.4 ELECTRICITY DISTRIBUTION

The distribution systems include 33kV, 11kV and 0.4kV lines, which entails receipt of bulk
supply of electrical energy from generation and transmission networks for distribution to
consumers. Achievement of national connectivity and access targets require expansion of power
distribution networks. However, sharp increase in vandalism has considerably contributed in
worsening the situation of electricity distribution infrastructure leading to a number of
transformer failures and consequential power outages.
Efforts need to be done to enhance capacity, reliability, and quality of supply and reduce power
losses. Such efforts include refurbishment of existing distribution network, establishment of new
substations, installations of new distribution transformer, construction of new lines,
implementation of pilot distribution automation project; implementation of customer service
improvement programs including installation of Automatic Meter Reading (AMR) for large
customers and pre-paid meters for small to medium customers. (TANESCO 2014)

2.5 DOMESTIC ENERGY

Domestic energy is dominated by the use of biomass in the form of wood or charcoal. The nearly
1 million tons of charcoal consumed each year require an estimated 30 million m3 of wood. The
average annual loss in forest cover attributed to charcoal production is estimated at 100,000
125,000 hectares13, with 2050 million tons a year in increased CO2 emissions (depending on
whether fuel-wood is removed from forests or other woodlands) Domestic energy, especially in
rural areas, has a strong gender component. Access to modern energy services greatly improves
the well-being of women and contributes to gender equality and poverty reduction. Gender issues
are recognized in the Tanzanian Constitution, the Development Plan 2011-2016 and in the
Vision 2025.
The World Bank, through the Africa Renewable Energy Access Program (AFREA), has worked
with government to empower the REA on gender issues. This has resulted in the finalization of a
gender strategy for REA and in capacity building to improve the integration of gender
considerations into project development, implementation and evaluation.

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 CHAPTER THREE

RENEWABLE ENERGY RESOURCES

3.1 SOLAR ENERGY

Tanzania has high levels of solar energy, ranging between 2,800-3,500 hours of sunshine per
year, and a global horizontal radiation of 47 kWh per m2 per day. Solar resources are especially
good in the central region of the country, and it is being developed both for off-grid and grid-
connected solutions. (Energypedia, 2016)

Off-grid solar photovoltaic

Government, through the REA and various donors, has supported a number of solar PV
programmes that target off-grid areas where the cost of lighting from solar is less than from a
diesel generator or kerosene. To date, about 6 MWp (megawatt peak) of solar PV electricity has
been installed countrywide for various applications in schools, hospitals, health centres, police
posts, small telecommunications enterprises and households, as well as for street lighting.
In recent years, many small scale solar lighting products have entered the Tanzanian market.
These off-grid lighting products or systems that are stand-alone, rechargeable and can be
installed, assembled and used easily without requiring assistance from a technician have come to
be known as pico-solar products. They range from solar lanterns to small solar home systems,
from 5 up to 100 euros in price and typically consist of a small solar panel, a rechargeable
battery and an LED bulb. Entry level pico-solar products can only be used for lighting, but the
more advanced systems also offer phone charging services. Because of the affordability and ease
of use of these products, they are very well suited for rural off-grid households and can serve as
an ideal replacement for kerosene lamps that are currently being used for lighting in most
Tanzanian rural households. The solar lights can also give school children the chance to study in
the evening. (Energypedia, 2016)

Figure 3.1and 3.2: Small Scale Solar Lanterns (Source: Ministry of Energy and Minerals)

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3.2 HYDROPOWER

Tanzania has natural topographic features which provide the country with many opportunities for
hydropower resources, to the magnitude of 4.7 GW in total only 12% of which is currently being
tapped. It is a country of great lakes such as Lake Victoria and has rivers and basins such as
river Rufiji (Rufiji basin), Pangani (Pangani basin) and Wami (WamiRuvu basin).Over the years
the power sector of Tanzania has been dominated by hydropower. However, poor rains in the
past few years resulted in a shortage of water to the turbine generating electricity. This was
further aggravated by agricultural activities that were going on upstream. As such, Tanzania
embarked on a deliberated measure to forge an energy mix which will ensure reliable availability
of power for the economy. (Renewable Energy Africa, 2015)

Large hydropower

Historically, hydropower has been the mainstay of Tanzanias national electricity system, with
an installed capacity of 562 MW. However, intermittent river flows resulting from droughts have
decreased its reliability as a power source.

Another key challenge facing hydropower development in Tanzania is the regional mismatch
between hydro sites and major demand centres. Hydro generation facilities are located primarily
in the southwest, whilst major demand centres are in the north, northwest and east. To realise the
full potential of hydropower, weak transmission systems must be strengthened.
Tanzania intends to develop additional large-hydro capacity. Some of this capacity is located in
areas currently set aside for wildlife conservation, as part of a national park. Estimates of
potential additional capacity go as high as 4,000 MW, but the long-term reliability of the water
flows has not been clearly established yet.
The PSMP includes 16 projects with a combined capacity of 3,000 MW. With the proposed
capacity additions, large hydropower is still expected to exceed 30% of generation capacity after
202516, thus risking a repeat of drought-related supply disruptions. Adding other renewable
energy sources to the generation mix could mitigate this risk. (Renewable Energy Africa, 2015)

Figure 3.3Tanzania Large Hydropower Stations

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 Small hydropower
The assessed potential of small hydropower resources (up to 10 MW) is 480 MW. Installed, grid
connected, small-hydro projects contribute only about 15 MW. Most of the developed small-
hydro projects are owned by private entities and are not connected to the national electricity grid.
Five sites in the 300 kW8,000 kW range are owned by TANESCO. Faith-based groups own
more than 1617 with 15 kW-800 kW capacity and an aggregate capacity of 2 MW. Of the 11
projects for which SPPAs have been signed, four are mini-hydro projects, with a
combinedcapacity of 20.5 MW, whilst the others are biomass powered. In addition, TANESCO
has signed lettersof intent for six small hydro projects with a combined capacity of 29.9 MW.
Several small hydro projectsare also being developed as isolated mini grids and the MEM is
conducting small hydro feasibility studiesin eight regions: Morogoro, Iringa, Njombe, Mbeya,
Ruvuma, Rukwa, Katavi and Kagera. Developmentpartners are supporting several mini-micro
grid projects throughout the country. (Renewable Energy Africa, 2015)

3.3 BIOENERGY

Biomass
Biomass is Tanzanias single largest energy source, although much of it is produced in
traditional and unsustainable ways. It is primarily used in the domestic sector. The sector is a
major employer: an estimated 1 million people in the informal sector are engaged in charcoal
preparation and supply. Because of weak enforcement and lack of awareness, much biomass
from forests is harvested unsustainably. A 2010 World Bank report on charcoal in Tanzania
reveals that
Some 100,000125,000 hectares of annual forest loss is attributable to unsustainable
charcoal production and
The Government of Tanzania is losing about US$100 million in annual revenue (2014)
Biomass is presently used for grid generation (around 18 MW) and by the agro-industry to
generate its own electricity (about 58 MW estimated). The potential for modern biomass uses is
high, considering that the raw material available is abundant and includes: sugar bagasse (1.5
million MTPY), sisal (0.2 MTPY), coffee husk (0.1 MTPY), rice husk (0.2 MTPY), municipal
solid waste (4.7 MTPY) and forest residue (1.1 MTPY). Further supplies can be obtained
through sustainably harvested fuelwood from fast-growing tree plantations. (Energypedia, 2016)

Small-scale uses of biomass for energy generation in rural areas are taking off. Under the SPPA
programme, two biomass power projects are supplying power to TANESCO: TPC, a major sugar
producer with an SPPA for 9 MW of power20; and TANWATT, a tannin producer with an
SPPA for 1.5 MW. A third SPPA for 1 MW, the Ngombeni project, was commissioned in
February 2014 to supply power to TANESCOs isolated grid on Mafia Island. TANESCO has
signed SPPAs for three additional biomass projects with a total capacity of 9.6 MW.

Various development partners are supporting biomass-sector development. The EU is supporting

the preparation of a Biomass Energy Strategy. The Norwegian Agency for Development
Cooperation (NORAD) and the Swedish International Development Cooperation Agency
(SIDA) are supporting institutional and legal frameworks for developing the bio energy
(biodiesel and ethanol) subsector. CAMARTEC is implementing a four-year, country-wide
biogas programme (200913) supported by the Netherlands, which aims to construct 12,000
digesters of various sizes for household cooking and lighting and electricity production. The

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REA, under the TEDAP, is providing matching grants for development of several biomass mini-
and micro-grids.
Biofuels
Biofuels are liquid or gaseous fuels produced from biomass that are generally high in sugar (such
as sugarcane, sugar beet, sweet sorghum), starch (such as corn and cassava) or oils (such as
soybeans, rapeseed, coconut, sunflowers, and palms). The two most commonly used biofuels are
ethanol and biodiesel. Biofuels are mostly used as a transportation fuel. Gel based biofuels can
be used for cooking.
There is potential for the sugar sector in Tanzania to produce ethanol or ethanol gel as a cooking
fuel that could serve as a replacement for kerosene or charcoal. TaTEDO examined these
options. The draft MEM Liquid Biofuels Policy is expected to be released in the near future

3.4 WIND ENERGY

Tanzania has plentiful wind resources along the coastline, the highland plateau, and regions
passed by the Rift valley, on the plains and around the Great Lakes.Several areas of Tanzania are
known to have promising wind resources. In areas where assessments have been conducted, only
Kititimo (Singida) and Makambako (Iringa) have been identified as having adequate wind speeds
for grid-scale electricity generation. At Kititimo wind speeds average 9.9 m/s and at Makambako
they averaged 8.9 m/s at a height of 30 m. MEM, in collaboration with TANESCO, is conducting
wind resource assessments in Mkumbara (Tanga), Karatu (Manyara), Gomvu (Dar es Salaam),
Litembe (Mtwara), Makambako (Iringa), Mgagao (Kilimanjaro) and Kititimo (Singida). The
REA is supporting wind measurements on Mafia Island (coastal region). MEM and TANESCO
will conduct wind resource assessments in Usevya (Mpanda). (Energypedia, 2016

To date, four companies have expressed interest in investing in wind energy, namely Geo-Wind
Tanzania, Ltd. and Wind East Africa in Singida, and Sino Tan Renewable Energy, Ltd. and
Wind Energy Tanzania, Ltd. in Makambako. These companies are considering investments in
wind farms in the range of 50100 MW.

3.5 GEOTHERMAL ENERGY

Tanzania has significant geothermal potential that has not yet been fully quantified. Estimates
using analogue methods indicate a potential exceeding 650 MW, with most prospects located in
the East African Rift System. Most geothermal prospects have been identified by their on-surface
manifestation, mainly hot springs. Surface assessments started in 1976 and, to date, more than 50
sites have been identified.

Geothermal sites are grouped into three main prospect zones: northeastern (Kilimanjaro, Arusha
and Mara regions), southwestern (Rukwa and Mbeya regions) and the eastern coastal belt (Rufiji
Basin), which is associated with rifting and magmatic intrusions. Only the southwestern zone has
undergone detailed surface exploration studies. In 2006 and 2010, MEM, in collaboration with
the Geological Survey of Tanzania, the German Federal Institute for Geosciences and Natural
Resources and TANESCO, carried out surface exploration and conducted detailed studies in the

14
Ngozi-Songwe prospect in the Mbeya region. Geothermometers showed that the reservoir
temperature exceeds 200 C (Figure 3.4).

Figure 3.4: Distribution of Geothermal Prospects (Source: SREP investment plan).

Recognizing the potential of geothermal resources and their contribution to energy

diversification, government formed a National Task Force on Geothermal Development. Its main
task is to advise government on national geothermal resource development. Government intends
to prepare a Renewable Energy Policy and Geothermal Energy Act to expedite and scale up
geothermal development in the country.

3.6 OCEAN ENERGY

Up to date in Tanzania mainland (Tanganyika) there is no ocean energy but Zanzibar is

considering the possibility of turning Indian Ocean currents and waves into electric power to
make the utmost of its geological position as an archipelago off east Africa. If the initial study
proves viable, the Zanzibar Utilities Company will build a power plant on the Pemba Island, one
of the three major islands consisting the archipelago, which enjoys a history of strong currents
and tidal waves. The company expects to resort to power generated from tidal waves or ocean
currents to turn the table against its loss-making situation. It now spends an average of 200
million Tanzanian shillings (200,000 US dollars) per month to generate power via gas turbines
whereas it collects 60 million shillings (60,000 dollars) for its power supply.
Ocean energy constitutes to a large unexploited source of renewable energy and wave power
therefore commands a good economic potential. The Zanzibar Utilities Company will wait for
the initial study to decide on whether to benefit from the wave power or the tidal power, which
15
dictate two different energy converters to transform wave energy or tidal energy into electricity.
With prices of non-renewable natural gas rising in many countries around the world as readily
accessible supplies dwindle, those countries which have a suitable stretch of coastline

16
 CHAPTER FOUR

EXISTING RENEWABLE ENERGY TECHNOLOGIES

4.1 INSTALLED PV PLANTS AND CAPACITIES

It is estimated that about 2 MW of solar photovoltaic (PV) has been installed for various
applications of which an estimated 30% is contributed by Solar Home Systems (SHS). The
estimated sales of SHS are more than 500 to 600 systems per annum. However, most solar
systems are institutional and are donor funded. Surveys of solar systems used for health and
education institutions show low sustainability, with a high proportion of installed systems not
fully working. In most cases after sales service and local maintenance arrangements are not in
place. There have been, however, some positive developments in the past years. With assistance
from Sida, six service providers have expanded their networks in rural areas of Kigoma, Rukwa,
Mtwara, Mbeya, Ruvuma, Dodoma, Iringa, Morogoro, Coast Region and Tanga. Other projects
were implemented in the Regions of Rukwa, Kigoma, Ruvuma, Shinyanga, and Tabora under the
Tanzania Energy Development and Access Expansion Program (TEDAP). In addition, 200
artisans have been trained on how to install and maintain solar home systems. UNDP, through
the Global Environment Facility (GEF), has a program that is now being replicated to cover
Mwanza, Kagera, Mara and Shinyanga. Solar PV systems have already been installed in 33
healthy centers, 22 dispensaries and 11 secondary schools. Furthermore, a solar energy
association has been established. Lastly, some of the dealers have established initial strategic
partnerships with micro finance organizations and private organizations with rural outreach.

Figure 4.1: Iringa (Tanzania) Farm| Solar Water Pumping Installation

17
4.1.1 PV SOLAR HOME SYSTEMS
Box 1: Energy enterprise TRC phone
This was due to steady national economic growth, charging Only 30% of rural Africans are
better pricing for Tanzanian agricultural products phone users, partly because of the problem to
charge the phones. Very often they need to
(tea, coffee, cashew nuts, etc.), increased awareness travel long distances. The entrepreneur Ruth
and continued slow electrification rates. As well, Musenye invested in small solar panel
Government supported initiatives such as the 2002- systems for phone charging and lighting,
2006 National PV projects did much to increase obtaining 14 Watt panels from Zara solar in
Mwanza at a cost of 300 USD. With help of
awareness about the potential of PV for off-grid
the DEEP-Programme and respective
household electrification and set up regional training as well
distribution networks. as coaching on developing the business plan,
The market is largely an unregulated, competitive, she diversified by adding 2 barber shops
over-the-counter, where equipment is purchased which operate with solar energy. In addition
she scaled-up her mobile-phone charging
on a component basis from hardware shops, business: Now she is serving more than 30
electrical stores and agents which have relatively customers compared to 5-10/ day before. The
strong supply chains. There is much complaint Programme helped her to submit her
about sub-standard products and the domination of application to SIDO (Small Industries
the sector by a few high volume players that do not development Organization), a government
operated micro finance institution. Source:
conform to national regulations. GVEP International, developing Energy
Several established PV companies such as Ensol Enterprises in East Africa, booklet 201
and Rex Solar Energy stated that they got out of
the solar home system market and focused instead
on the project market because of the highly competitive nature of the solar home system
market and because of the lack of quality or margins in the sector.
The off-grid commercial SHS and pico-solar market likely to be about 1 MWp per annum. It has
been increasing steadily since 2008. The major developments in recent years are a) increased
prevalence of low-cost product from the Far East b) wider use of inverter-based system because
of consumer demand for televisions and AC electrical goods and c) price competition due to
larger number of players in the market: As happened in Kenya in the 1990s, the last 10 years
have seen a large increase in retail outlets in small towns supplying solar equipment directly to
consumers.

4.2 INSTALLED SOLAR THERMAL PLANTS AND CAPACITIES

Solar thermal energy has been used for generations in Tanzania for drying crops, wood and salt.
Currently, solar dryers are used in the agricultural sector to dry cereals and other farm products,
including coffee, pyrethrum and mangos. Households and other institutions (e.g. hotels,
hospitals, health centres and dispensaries) are the main users of solar water heating systems in
Tanzania. Despite the potential of solar thermal and the demand for low-temperature water for
both domestic and commercial applications, uptake is low. Lack of awareness, inability to
mobilise fiancing, relatively lower priority given to such investments (i.e. water heating may not
be a major cost relative to others) are some of reasons attributed to the low usage of solar hot
water heating. Other more advanced solar technologies, such as concentrated solar power, are not
present in the country

18
4.2.2 SMALL-SCALE SOLAR THERMAL SYSTEMS

Since the solar home system market operates largely along the same retail chains as consumer
goods such as TVs, music system and, increasingly, cell phones, equipment importers are not
the ultimate installers of SHS, rather it is the retailers that manage this work. The capacity of
consumers to buy entire systems and pay for installation services are constrained, therefore, the
market for installers is also constrained. For example, many system retailers focus first on
making an equipment sale (and consequent margins) and afterward on finding installers.
Although this is not the case with all sellers, it is certainly an important part of market
development.Retailers often have a group of independent installers attached to them who can be
called upon to complete an installation once a saleis made.

Figure 4.2: Installed water heater system

4.3INSTALLED WIND TURBINES AND CAPACITIES

Development of wind propelled energy systems has been tried. Micro turbines of 8kW have been
installed as well as wind mills for water pumping. The Government in collaboration with
Denmark has conducted studies and mapped potential areas for generating electricity using wind
energy in Regions of Arusha, Dar es Salaam, Tanga, Mtwara, Iringa, Kilimanjaro, Manyara and
Rukwa. Potential sites for investments in wind energy include Karatu in Arusha, Gomvu in Dar
es Salaam, Mkumbara in Tanga, Litembe in Mtwara, the area around Makambako in Njombe
district, some areas in Singida region and Same district in Kilimanjaro region.

19
The feasibility studies for Makambako and Singida have already drawn interest of investors in
setting up wind farms for electricity generation. Two firms called Wind-EAI and Power Pool
East Africa are establishing two wind energy farms at Kititimo in Singida Region after getting
the necessary approvals from TANESCO and EWURA. To begin with, Wind-EAI is developing
50MW and Power Pool EA 30MW. Power Pool EA has also shown interest on the Makambako
site. The fact that wind based technology is considered environmental friendly gives an added
advantage to investors who can draw on benefits under Clean Development Mechanism (CDM)
from carbon credits.
Singida Wind Power Station

Singida Wind Farm is a potential 100 megawatts wind-powered electricity power station, under
construction in Tanzania. The power station is located approximately 10 kilometres, by road,
south-east of Singida, about equidistant between Singida and Puma. The coordinates of the
power station are 0453'58.0"S, 3447'22.0"E. The power station is privately owned by Wind
East Africa Limited. The 100MW power projected will be sold to the Tanzanian power
company Tanesco for integration into the national power grid. The station construction cost is
budgeted at US$285 million, and the station is expected to be ready in December 2017. (MEM
website)

Figure 4.3 and 4.4: installed wind turbine at Singida (Tanzania)

4.3.1 WIND TURBINES FOR WATER PUMPING

Small-scale wind driven power generation and e.g. pumps can be a significant part ofrural
energy. Installations would typically be considerably smaller than small hydro, but investment
and installation costs are smaller for plants of up to a few 100kW, which makes for a more plants
and production closer to the user. A number of wind-driven water pumps have been installed for
agricultural purposes in Tanzania. AFREPREN (2004), reports on over 100 such windmills being
installed by 1996, but with 40% ofthese not in running order in 2004.

20
Small-scale wind power units, of around 10-100 kW are on sale in the country, with a potential
for pumping water and supplying power. One or more wind turbines can supply energy for a
battery based off-grid system, or be part of a hybrid system together with e.g. Solar or hydro.
The sector sees a lot of activity both from commercial companies and NGOs and is a suitable
area for market development in that installed systems have very limited environmental impact, is
easy to install and also easy to decommission and sell on if the situation for the user changes.

Off-grid base station hybrid systems, combining wind and solar energy to supply
telecommunication stations have been deployed in Tanzania and will be more importantas fossil
fuel becomes more costly. Such systems can save up to 90% of diesel consumption, more than a
cubic meter per base station, and with several thousand off grid stations in the country, this holds
large potential. Supporting the installation of electricity generation for both domestic and
agricultural use, as well as mechanic modern wind-driven pumps may well be worthwhile to
create a market for entrepreneurs and funding mechanisms. Awareness and demonstration
activities, just as seen in recent projects in the solar area, are also relevant

4.4 INSTALLED GEOTHERMAL PLANTS AND CAPACITIES

With regard to Geothermal Power, the estimated potential is about 650MW with potential sites
being Lake Natron, Lake Manyara, Luhoi in Rufiji, Songwe in Mbeya and Lake Ngozi. The
Songwe site has been studied in some detail and has indicated a potential of more than 10MW.
However, more studies are required to determine the size of the reservoir. With regard to small
hydro, potential sites are in Mbeya, Rukwa, Ruvuma, Kagera, Kigoma, MorogoroTanga and
Iringa. In Iringa Region, these sites are at Mhanga River (Kilolo), Ndembela River (Mufindi),
Hagafiro, Uwemba, Itidza, and Balali Rivers (Njombe).
A regulatory framework, including standardized power purchase agreements and tariff
guidelines, specifically for SPPs (less than 10 MW) have been developed by EWURA. It is
expected that the existence of the SPPAs and Rural Energy Agency and the Rural Energy Fund
(REA/REF), will encourage more private sector investments in the power sub-sector. REA will
stimulate and co-finance private sector led investments in modern energy services.

NgoziMbeya ,Geothermal Project Area

Project Description

Ngozi area is situated directly south of Mbeya town in South West Tanzania at a triple
junction of the East African rift. The area was recently studied within a Technical
Cooperation Project of the Tanzanian and German governments. The magma chamber of
Ngozi volcano is acting as heat source for a high-temperature geothermal system with
reservoir temperatures of more than 200C in >2000m depth.In continuation of the previous
results, GPT has planned supplementary fieldwork mainly for finding the best located and
accessible drill sites and seek to implement the following development schedule.
Development Schedule

21
 2012: Drilling of up to three shallow temperature gradient wells for testing the
existing conceptual model
2013 - 2015: Exploration, production, and injection wells as well as reservoir testing;
feasibility study; preliminary plant design
2014: negotiations of a conditional PPA for a 100 MW power plant
2015/2016: Design and layout of the geothermal power plant and steam gathering
system; plant manufacture; plant construction; power production. (MEM website)

The Tanzanian has recently committed the Tanzania Geothermal Development Company
(TGDC) to start with drilling activities in Lake Ngozi in Mbeya region in southern Tanzania by
June, 2016, to set the basis for the construction of power plants for geothermal generation. The
drilling activities are in line with TGDC plans to add to the countrys current capacity installed
of 1,754 MW, a total of 100 MW by 2020, 500 MW by 2022 and 800 MW by 2025 with the
support of Toshiba Corporation (TYO: 6502) that will be in charge of the development and
provision of major equipment for geothermal power generation, creation of guidelines for plant
operation and management as training of personnel as well

Figure 4.5 and 4.6: Ngozi area (Mbeya) for geothermal project

4.5 INSTALLED BIOENERGY POWER PLANTS AND CAPACITIES

The bulk of energy consumed is from traditional biomass (fuel wood and charcoal) which
represents about 90 percent of the total energy consumption. In addition, more than 80 percent of
total primary energy (mainly in the form of biomass) is consumed in the rural areas. Likewise,
there are considerable biomass resources in the form of agricultural wastes, forest residues and
animal wastes which could be effectively utilized to produce energy and thus assist in redressing
the concern of increasing scarcity of biomass fuels which affects women and children to the
extent that they have to travel longer distances to collect firewood,
Biomass for power generation is also available on a small scale. A 2.25 MW wood-fuelled power
plant by the Tanganyika Wattle Company (Tanwat) in Iringa and a few bagasse fuelled
cogeneration plants at TPC in Moshi (10 MW), Sao Hill (24MW), Southern Paper Mills

22
Mgololo(10MW), Mtibwa and Kilombero (10MW) are typical examples of biomass potential for
power generation, Also
The Tanzania Sisal Authority has commissioned a biogas electricity generation plant with
installed capacity of 150 kW with possible expansion to 300 kW. The Common Fund for
Commodities, UNIDO, and the Tanzania Sisal Board and Katani Ltd are financing the first pilot
plant to produce biogas, electricity, process heat and fertilizer.
The pilot plant is located in Hale, Tanga Region, to boost power generation from biomass, MEM
inaugurated on 20 August, 2009, an International Centre of Excellence for capacity building for
biogas and biomass utilization. It is estimated that up to 200 MW could be produced from annual
urban wastes, and 45 MW from the sisal wastes currently being produced.

Figure 4.7 and 4.8 Sisal Biogas plant in Hale-Tanga (Tanzania)

23
 CHAPTER FIVE

RENEWABLE ENERGY DEPLOYMENT DRIVERS AND BARRIERS

5.1 DRIVERS

Among of the drivers for deployment of renewable energy the main goal and
motivation for rural electrification is related to individual and social development. They
then divide some of the more important benefits of electricity into direct, potential and
long-term benefits. The direct benefits include improved living standards by lighting,
better health care and education, entertainment and communication. Potential benefits
include increased income generation from productive activities, access to water pumps
and mills, reducing work burden on women and reduced household expenditure. Long-
term benefits include returns from improved education improved education, health and
production efficiency. According to Kammen and Kirubi (2008) the key socioeconomic
drivers for solar PV systems in rural Africa are the possibility to use it for lighting, TV,
radio and cellular phones.

Undeniable, renewable energy has played out differently in each case, shaped by the various
purposes of individuals, businesses and communities in Tanzania. However, the deployment
of renewable energy technologies has translated overall into:
More time to students for reading in the evening hours
More conducive and hygienic medical environment
Saved time and money
Income generation and employment creation
Facilitated communication to improve markets and exchange information on prices
Well cooked food
Reduced in-door air pollution
Reduced deforestation
Protection of water supply from natural streams

5.2 BARRIERS

Renewable Energy is a great opportunity but it encounters several barriers related to

institutional or policy issues, knowledge and capacity gaps, and economic and financial factors.
Got, with support from development partners, is developing mitigation measures that include
better planning tools and effective policy reforms, strengthening of institutional and human
capacity, and financial incentives.

24
 Institutional, policy, regulatory and legal frameworks
RE is a great opportunity but it encounters several barriers related to institutional or
Barriers
Uncertainty about the
future direction of power-
generation investment
planning; i.e. the PSMP
baseline plan has a limited
role for renewable energy
(large hydro),reflecting
inadequate data and
unavailable power planning
methods that could more
effectively integrate a wide
range of renewable energy
options, especially
distributed generation.
Project developers face
multiple risks developing
renewable energy projects
in Tanzania, including off-
taker risk (particularly
TANESCO), currency risks
(if power purchase
agreements in TZS), and
resource uncertainty.
Complex formal
requirements linked to
preparation and approval
of renewable energy
projects, resulting in
lengthy time required to
bring financial closure to
smaller projects.
Lack of information and
Mitigation measure Primary
relevance
PSMP planners require access to
more effective planning tools and
better planning processes.
Some progress is being made. For
example, the Rural Electrification
Investment Prospectus explicitly All renewable
considers distributed renewable energy
energy generation.
Future revisions to the PSMP will
improve its consideration of
renewable energy
Considerable progress has been
made in reducing regulatory risks,
especially for SPPs (under 10MW),
But similar work is now needed for
larger-scale renewables. TANESCO
needs revitalization1 to become All renewable
financially sustainable, with a cost- energy
reflective tariff. In the interim,
risk-mitigation mechanisms
Against TANESCOs default/late
payment risk need to be developed.
Government can invest in resource
assessments (e.g. geothermal, wind,
small hydro
and biomass) and make this
information publically
available
Investments in renewable energy are
still relatively new in Tanzania. The
policies, regulatory and
Administrative processes, and
financial incentives are not yet
tested. Administrative processes are
quite lengthy and need to be
mainstreamed.
Further institutional capacity
strengthening and streamlining of
processes are required. The REA All renewable
could play a facilitating role (e.g. energy
becoming a one stop shop for rural
electrification projects). Also,more
comprehensive transaction advisory
services or funding are needed.
More broadly, government must
address constraints facing IPPs, and,
in fact, it has committed to do so.
The Rural Electrification Investment
25
uncertainty about grid
extension plans results in
worries about grid
encroachment and
increases the risks borne
by private companies in
developing mini-grid
projects.
Biomass resource
extraction from forests is
virtually unregulated, which
leads to unsustainable
harvesting of fuel wood
and charcoal. The current
regulatory and enforcement
environment and the move
to other energy sources
have not proven effective.
Also, there is little
awareness of the need to
operate sustainably.
Knowledge sharing and capacity issues
Barriers
Pre-investment and
transaction costs for
renewable energy, including
resource assessment and
feasibility studies, are high.
Tanzania has limited
expertise in undertaking
feasibility studies, detailed
design and construction. It
is difficult to find qualified
staff willing to be posted
in remote locations
Prospectus will identify areas for Mini grids and
grid extension and renewable based, stand-alone
mini- and off-grid supply off-grid
opportunities
renewable
Mitigation measures include
improving revenue collection
methods and providing funds and
training to local governments to
improve sector supervision, using
fiscal incentives to support
sustainable Biomass
Harvesting practices and
strengthening capacities for
monitoring and enforcement.
Mitigation measure Primary relevance
REA matching-grant
support programmes should
be expanded and adapted
to the needs of a scaled-
up program. The current
project-by-project
approach is time intensive
with high transaction All renewable energy,
costs; bundling services especially SPPs and mini
would mean delivery of grids
better-quality services at
lower costa key aim of
SREP IP off-grid
electrification. Cost shared
assistance should be
provided, possibly
converting it to
equity/debt on successful
financial closure.
Building human and
institutional capacity
requires expanding
specialized training,
supporting local educational
All renewable energy
and sector institutions that
deal with renewable energy,
supporting partnerships
with international firms
through South-South and
26

There is a lack of
renewable resource
information on needed
quality and duration
Low-cost, small solar
lighting products sold
directly to customers may
be of low quality, and
customers may be unable
to
Discriminate between well-
and poorly-made products.
Extraction enforcement is
lacking in forests, which
are easily accessible and
provide low or no-cost fuel
wood supplies
In terms of economic and financial issues
Barriers
Renewable energy projects
have a highcapital cost.
Technologies are
capitalintensive and the
period for pre-investment,
Financial closure and
construction is of
longduration. The types of
financing and financing
conditions available
domestically are notwell
suited to the development
of renewableenergy
projects.
North-South exchanges,
and developing
implementation models that
can deliver services more
efficiently.
Resource assessment work
should be expanded for
geothermal and should
cover biomass and solar
resources (wind resource
All renewable energy
monitoring is ongoing).
Hydro resource
characterization for mini
grids should be expanded.
Information should be
easily accessible to
developers.
Building on the outcomes
of the Lighting Africa
Program can create public Off grid
awareness of high quality
products and thus
encourage their marketing
and sale.
Alternatives to
unsustainable wood
extraction include better
resource information,
adoption of sustainable
Biomass
harvesting plans,
community forestry,
support of efficient
charcoal production and
more effective wood
pricing.
Mitigation measure Primary relevance
By increasing access to
long-term financing
through commercial banks,
the high capital
expenditure can be spread
over a longer period.
Transaction advisory
services can be expanded
to assist local developers
in finding equity partners.
Thus, WB or similar
Credit lines should be
extended and scaled up. All renewable energy
Partial risk guarantee
instruments can be offered
to cover off-taker,
27

Revenues are uncertain.
For projects that sell
power to TANESCO, there is
a risk of payment delay.
Rural residents spend a
significant portion of their
income on energy services
yet have limited ability to
pay for electricity
connections and
consumption under
traditional billing
arrangements (i.e. end of
the month or every three
months).
The informal nature of the
fuel wood/charcoal industry
and low incomes make it
difficult to gain access to
capital needed to improve
production, develop
sustainable wood sources
and reduce consumption by
using more efficient
devices.
currency and other
commercial risks that
foreign equity partners
may require.
Government is engaging
with its development
partners and TANESCO to
help resolve the current
problem. The WB has
approved the first tranche
of a policy operation to
help ease TANESCOs Grid-connected IPPs
financial burden. This will andSPPs
facilitate repayment of
overdue accounts.
Both of the proposed SREP
projects plan to establish
risk guarantees to avoid
TANESCO payment delays to
the private sector.
Output-based grants can Mini-grids and off-grid
be used to buy down a
portion of the capital cost
of off grid services. Credit
and/or pay-as-you-go
solutions can be offered so
that households can spread
out system payments over
time,mirroring current
spending on energy
services, such as kerosene
for lighting or
batterycharging
for mobile phone
Biomass
Microfinance organizations,
coupled with technical
assistance and technology
transfer, can be used to
provide financing.
28
 CONCLUSION

Tanzania has abundant renewable energy resources such as (hydro, solar, wind, geothermal, bio-
energies, tidal waves). Despite these resources, there is yet insufficient supply of modern energy
services. The energy sector in Tanzania faces considerable challenges which include: mobilizing
funds for investment; attracting private capital in the electricity sub-sector; increasing connection
and access levels to electricity; diversifying energy resources for power generation; enhancing
affordability and reliability of power supply; and reducing power system losses both technical
and non-technical

Government to invest more in promotion of renewable follow-up on research for development of

large scale geothermal energy scale up of Renewable Energy technologies that have proven
feasibility, viability by prior projects follow-up on large scale wind power projects promote
demand side management through energy efficiency and conservation improve availability of
hydro power through research encourage large scale growers of oil seed for biodiesel to build
processing plants support research in ocean energies facilitate further support to companies
involved in the manufacture of RE equipment such as small wind turbines and small water
turbines

Energy Sector plays an important role in the socio-economic development of any country. To
ensure effective management of the sector, the Government of Tanzania have energy policy
which increasing activities in the Energy Sector and accommodate public sector reform
objectives, Despite several interventions in the past decade, the Energy Sector has been facing
some challenges embedded in policy, legal, regulatory and institutional frameworks. To address
the challenges and achieve the desired policy objectives, Energy Policy enhances provision of
adequate, reliable and affordable modern energy services to Tanzanians in a sustainable manner.
The policy also provides comprehensive legal, regulatory and institutional frameworks for
petroleum, electricity, renewable energies, energy efficiency as well as local content issues.

29
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4. Initial National Communication Report Under The United Nations Framework

Convention On Climate Change (Unfccc) July 2003.

5. International Energy Agency: Beyond the OECD. Tanzania, United Republic

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bmit

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8. Read more at: http://www.tanzaniainvest.com/energy/tanzania-starts-construction-works-

on-240-mw-kinyerezi-2-gas-fired-power-plant and follow us on
www.twitter.com/tanzaniainvest

9. Renewable Energy in Africa: TANZANIA Country Profile (2015) Printed, designed and
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