Why electricity should be top priority for Samia

Nothing displays the thoughtlessness of those who manage Tanzania’s economy than the performance of our energy sector. The more you learn about it, the more you are shocked by what people are getting away with. It beggars belief how anybody could conceive Tanzania’s economic transformation with this state of affairs.

According to Tanesco, the total installed electricity generation capacity in Tanzania is 1,574MW against a demand of 1,120MW. On the surface, that looks quite alright but it is a load of balderdash.

Firstly, installed capacity isn’t synonymous with generating capacity. Different systems have different efficiency rates, but most operate at least 30 percent below installed capacity. So, the figure people need to hear is that of potential generation capacity and not installed capacity.

Moreover, there is hardly a time when you can visit a power plant in Tanzania and find all generators are operational. I have had the privilege of working in some of them, and it wasn’t unusual to find two out of four or one out of two generators switched off. That infamous Tanzanian factor which guarantees that nothing ever works properly in our hands is material here, too.

Furthermore, Tanesco loses about 20 percent of power generated on transmission and distribution. Instead of transmitting power within 100km, it transmits for up to 400km. What do you expect? Twenty percent is massive – that’s hundreds of billions of shillings every year.

Therefore, the 1,574MW figure is a subterfuge, an attempt to make people feel better for nothing. The actual generation capacity is most probably below 1,000MW.

Secondly, how does Tanesco provide 1,120MW with a supply which is practically below 1,000MW? By using load scheduling. That means Tanesco instructs factories and plants to schedule their production in off-peak hours, thus significantly hampering their productivity. I understand that this is at least true in Dar es Salaam, Tanga, and Mwanza.

Thirdly, even by discounting the fact that 85 percent of energy comes from wood and charcoal, how can total demand be 1,120MW in a country of 60 million? Is Tanzania stuck in the times of the Flintstones?

Tanzania’s energy master plan had envisaged to have 5,000MW of installed capacity by 2020 and 10,000MW by 2025. Thus, by the government’s own analysis, the actual demand in 2022 should be above 5,000MW – not 1,120MW.

Moreover, statistics show that per capita electricity consumption in Tanzania is 103KWh, far behind even the African average of 665KWh. By this logic, the unmet demand is over six times the current supply. However, given highlighted issues with installed capacity and techniques such as load scheduling, the actual electricity demand appears to be ten times the existing supply, even by conservative estimates.

Fourthly, there are four regions – Lindi, Mtwara, Kagera, and Kigoma – and 15 other districts which are not connected to the national power grid. As a result, dozens of generators have to be used to supply power to those areas, usually at a cost far higher than the selling price, which is subsidised by other users. Moreover, power has to be imported from Kenya, Uganda, and Zambia for some of those regions.

So, what does this mean for Tanzania?

One, in an economy known for declining productivity, factories are being asked to produce far below their true capacity because of power. The competitiveness of the whole economy is being compromised by the current state of energy.

Two, many projects cannot take off because there is no power for them. This includes industrial parks in Mlandizi, Bagamoyo, Mkuranga, Geita, etc. Moreover, you cannot develop industries in regions which are not connected to the grid – the generators installed are not designed for heavy consumption. That is why if Geita Gold Mine had not install its own 30MW generator that mine would not be operational today. So, apart from hampering the much needed investment in the nation, there is also the question of lost revenues by Tanesco. Thus, Tanesco loses at least Sh250 million from Geita Gold Mine every single day.

Three, the cost for Tanzanians is much higher. Apart from being forced to suffer regular power blackouts, to purchase generators, to pay for fuel, to lower productivity, they are now suffering unemployment and underdevelopment just because industries cannot be built.

Such is the state of electricity in Tanzania, a country that for years has been flattering itself to be on the path of industrialisation! And, sadly, this is far from being a complete story.

So, what should be our takeaway from this bizarre story?

One, the truth shall set us free. So, we should do away with whitewashed reports and lies from the pits of hell, like “demand is equal to current utilisation”. If there is a sector in Tanzania that will greatly benefit from transparency, it is the energy sector. Grand corruption has entrenched itself here because of secrecy. President Samia Suluhu Hassan should kick the windows open to let fresh air in.

Two, out of all the messes that President Hassan has inherited from her predecessors that need to be fixed, this ranks the highest in importance. The Nyerere Dam will provide temporary relief. It is a mistake to rely on it too much. Firstly, the planned 2,100MW is a mirage. The true capacity will most likely be below 1,500MW. Our latent demand is already much higher than what we will get from it and, since it takes years to get new power plants operational, that work should start now. I suggest leaps of 1,000MW and above, not 200MW.

The work that needs to be done in this sector goes far beyond the issues of generation. I will try to provide some solutions in a future article.