Rwanda is set to connect 77,470 households with electricity following the approval of a $180 million loan by the African Development Bank (AfDB) under the last mile connectivity programme.
The approval by the AfDB board Wednesday will see the East African Community member state co-finance a major energy project in the country that will extend electricity access to rural areas and reduce greenhouse gas emissions in Rwanda.
According to the pan-African lender, Financing for the Transmission System Reinforcement and Last Mile Connectivity project comprises $140 million from AfDB sovereign window and a $40 million co-financing from the Africa Growing Together Fund (AGTF), as well as resources from the bank.
In May last year, AfDB approved $84.2 million from its concessional window for the same project.
“The rationale for the Bank’s intervention is to support the country’s pursuit of 100% access to electricity by 2024. The Project will contribute to enhancing the quality of life by facilitating improved education and health provision as well as promoting private sector growth, hence contributing to Rwanda’s social and economic transformation agenda which aims to transition Rwanda from a developing country to a middle-income country by 2035,” said Aissa Tour-Sarr, AfDB Rwanda Country Manager.
The loan is expected to fund construction of over 1,000 km of medium voltage and 3,300 km of low voltage lines to boost last mile access.
Additionally, the financing will help build 137km of high voltage line and six substations required to strengthen the grid. Other features of the project include the installation or upgrading of more than 1,200 distribution transformers and related infrastructure, AfDB said.
The project will also connect 5 schools, 8 health centers and 65 administration centers to the grid.
Rwanda will also use the funds to evacuate 125MW of clean energy from hydropower plants and is expected create 455 permanent jobs and 760 part-time jobs, with 30% of these going to women.
The funding mainly targets households in Southern Rwanda where electricity access is still below 34%.
“The Bank is pleased to play an important role in actualizing Rwanda’s Transmission Reinforcement and Last Mile Connectivity Project, which will not only contribute to addressing the country’s energy poverty, including pursuit of universal access by 2024, but also aligns closely with the Bank’s High 5 priorities. Moreover, the project exemplifies the transformational impact of effective coordination amongst development partners,” said Dr. Kevin Kariuki AfDB Vice President for Power, Energy, Climate & Green Growth.
According to the bank, the Transmission Reinforcement and Last Mile Connectivity project is a component of the $670 million multi-donor Rwanda Universal Energy Access programme, which is being co-financed by the World Bank Group, OPEC Fund for International Development, Saudi Fund for Development, Agence française de développement, and the European Investment Bank.
The latest loan approval from AfDB now represents around 40% of the programme’s total cost.
As of March 2022, the lender has financed over $1.4 billion worth of projects in Rwanda, of which $498 million has been directed towards energy project projects.
