Tanzania seeks $13 billion for energy transformation

Dar es Salaam. Tanzania has announced a $13 billion funding requirement to implement key energy reforms aimed at boosting electricity supply, promoting clean cooking solutions, and expanding access to power in rural hamlets.

The commitment was made by President Samia Suluhu Hassan on Tuesday, January 28, during her opening remarks at the Mission 300 Africa Energy Summit, which ran from January 27 to 28.

The summit, attended by over 20 Heads of State and major development partners such as the World Bank (WB) and African Development Bank (AfDB), was a platform for discussing Africa's energy future.

President Hassan outlined Tanzania's strategic priorities, including the launch of a national energy compact aimed at increasing electricity connectivity to 72 percent by 2030.

This initiative forms part of Tanzania’s broader energy goals and is expected to significantly improve access to power across the nation.

In her speech, President Hassan revealed that the country plans to raise $5 billion of the required funds from the private sector.

This would be part of a comprehensive national strategy designed to address four key energy priorities.

"We, as African leaders, must commit to tackling the critical challenges in the energy value chain as outlined in our action plans. We also encourage our financial partners and the private sector to scale up investment, while we work towards enhancing our business environment and implementing policy reforms," said President Hassan.

The first priority of the national strategy focuses on increasing electricity production.

Tanzania currently produces 3,431 megawatts (MW) of power, with 58 percent generated from hydro, 35 percent from gas, and 7 percent from other renewable sources.

The target is to increase this capacity by 2,463 MW, tapping into solar, wind, geothermal, and other renewable sources by 2030.

The second priority is to strengthen Tanzania's position as a key electricity trading hub in the East and Southern African regions.

The country already connects to power grids in Burundi and Kenya, and plans are underway to link with Zambia and Uganda.

This would enhance trade within the East African Community (EAC) and the Southern African Development Community (SADC), positioning Tanzania to export surplus electricity, especially as domestic demand is projected to reach 1,888 MW by November 2024, against a current production of 3,431 MW.

The third focus is electrifying Tanzania's remaining hamlets, with the goal of extending power to all 64,359 hamlets across the country.

Currently, 32,827 hamlets are electrified, with work underway to reach an additional 20,000, leaving 11,532 hamlets to be covered.

The fourth priority highlighted by President Hassan addresses the need for clean cooking energy solutions.

With 950 million people in Africa lacking access to clean cooking technologies, the issue is particularly pressing in Tanzania, where 90 percent of households rely on firewood and charcoal.

These methods contribute to poor health outcomes and environmental degradation.

The national strategy aims to reduce reliance on these sources, increasing the adoption of cleaner alternatives from the current 10 percent to 80 percent by 2034.

"We are committed to reducing our reliance on harmful cooking fuels and promoting cleaner alternatives, which will not only improve health outcomes but also reduce environmental impacts," she said.

As the summit concluded, President Hassan urged her fellow African leaders to join forces and collaborate in achieving the continent’s energy goals, declaring that "together we can light up Africa and empower future generations."