POWERING EAST AFRICA

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• POWERING EAST AFRICA
• By
• SUSAN KIKWAI, OGW
• MANAGING DIRECTOR
• KENYA INVESTMENT AUTHORITY
• (KenInvest)
• ON
• THE 1st EAST AFRICAN INVESTMENT
• CONFERENCE
• 26th 28th June, 2008
• Kigali, Rwanda

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SECTOR ENERGY

• This presentation is aimed at giving brief
  overview of the energy situation among the EAC
  member States in terms of
• 1. Need for energy in the region
• 2. Level of stock and distribution
• 3. The EAC energy strategy
• 4. The existing energy project
• 5. Up-coming energy projects
• 6. 0pportunities of investment and areas of
  research.
• The objective of this presentation is to bring
  the delegates up to speed with the energy
  situation in the region and the need for more
  investment through public and private
  partnerships, individual undertaking, foreign
  direct investment or takeovers.
• The presentation will not discuss areas of
  regulatory and policy frameworks

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Why energy in the EAC

• Energy plays a critical role in the development
  of a country and is essential in economic growth
  and overall distribution of economic services.
• Poverty prevalence in EAC is a pressing challenge
  to achievement of faster EACs economic
  development vision (GDP per capita EAC US 345,
  population below poverty line 44). Increased
  energy production is required urgently to help
  member states reverse these trends. (There is
  consensus that energy services help reduce
  poverty and stimulate economic development, thus
  Millennium Goals (MDG) realization).
• Modern energy services will increase income
  opportunities by improving productivity, creating
  employment, and providing access to markets.

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Energy access situation in the EAC
The EAC region consider energy as an intermediate
factor of production that would support its
industrialization and peoples development
processes EAC with population of gt100Million
more than 81 of population live without access
to modern energy services lt 30 of households
use liquefied petroleum gas lt40 of urban and
lt5 rural households have access top
electricity and. lt10 of schools, clinics
and hospitals in rural areas have access to grid
electricity. At least EAC should aim at
reducing this low volume access by 50 by 2015 in
order to achieve its development goals

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Energy consumption

• Tanzania 90 households 14 million metric
  tonnes.
• Uganda 93 of total energy consumption 20
  million
• metric tonnes.
• Burundi 1 of the 6 million people in the
  country. By 2001, only 28,708 families were
  connected to the conventional electricity grid.
• Rwanda Under 5 of the population is served with
  modern
• energy (electricity) with 90 of the population
  still using traditional sources of energy.
• gt Kenya account for 68 of primary energy
  consumption
• 90 rural households34.3 million metric tonnes.

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Major sources of energy in the EAC Member States

• Geothermal
• Wind
• Hydro
• Solar
• Biomass

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Existing Regional power distribution system

• Kenya - Uganda power grids interconnected
  through a 132kV double circuit line.
• Tanzania and Uganda have a cross border supply
  through a 132kV line.
• Kenya and Tanzania have a cross border supply
  through a 33kV line.
• Rwanda and Burundi power grids are interconnected
  through a 70kV line

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Existing power networks in Kenya

• Interconnected system has a total installed
  capacity of
• 1, 232 Mega-Watts (MW) made up of
• 707 MW of hydro, including 30 MW of non firm
  import from Uganda
• 398 MW of thermal
• 127 MW of geothermal
• 0.35 MW of wind
• KenGen owns 83, Independent Power Producers own
  17.
• Of the 83, 30 of generation has been sold to
  public through the Nairobi Stock Exchange.
• Transmission system comprises 220 kV, 132 kV, and
  66 kV lines

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Energy projects to be commissioned by 2012

• 20 MW Sangoro Hydro expected cost US 54 m
• 5MW Ngong wind cost US15 m
• 25 MW Chemelil Bagasse US20m
• 140 MW Olkaria IV- cost US336m (work on 6
  appraisal wells at a contract price of US 36m is
  ongoing with 4 already completed)
• 5. 20 MW Kindaruma third unit to cots US25m
• These investments will generate an additional
  210 Mega-Watts to the National Grid.

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Future Energy production projects expected after
2012

• The government of Kenya will invite both local
  and international investors to participate in
  the following projects to help achieve Vision
  2030 goals
• 140 MW Menengai to- cost US336 m
• 200 MW CNG cost US 200m
• 60 MW Mutonga Hydro cost US 226m
• 100 MW Marsabit wind- cost US 180m
• 5. 300 MW coal Plant at Mombasa cost US 800 m
  (Feasibility study ongoing)

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Existing power networks in Tanzania

• System comprises of 6 hydro plants.
• Total effective hydro capacity of the grid system
  is 555 MW.
• Installed capacity of thermal generating sets has
  increased to 302 MW.
• Transmission voltages are 220 kV, 132 kV, and 66
  kV.
• Dar es Salaam is the major load centre.
• TANESCO remains under state control.

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Distribution systems in Tanzania

• Installed generation capacity connected to the
  power grid system is 577MW.
• Tanzania has an area of 954 000 square kilometers
  and has a 220kV.
• Transmission network covering 2,248km. It also
  has 1,400km of 132kV.
• Transmission lines. 55 isolated and mini
  hydroelectric generators having a Capacity of
  23MW supply 135km of areas not connected to the
  grid.

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Energy production projects in Tanzania

• Tegata 100MW of diesel generation.
• Kihanshi Hydropower will add 180MW
• Other possibilities include
• Establishment of some 420 MW of generation
  capacity between 2002 ad 2009 at Kinyerezi using
  Songo gas
• The 358 MW Ruhudji hydro facilities

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Existing power networks in Uganda

• Energy is supplied by 2 main hydro electric
  plants.
• Total installed capacity is 300 MW.
• Main transmission voltage is 132 kV with the
  sub-transmission system operating at 66 kV.
• A 200 MW hydro project in Bujagali is considered
  to be in service in late 2009.
• The distribution of electricity in towns is
  through 33 KV and 11 KV power lines. Long
  distance transmission is through 132 KV and 66 KV
  lines. The electric grid extends across the
  southern part of the country to cover Masaka,
  Kampala, and Jinja to the west of Owen Falls Dam
  and Tororo to the east where it connects with the
  Kenyan system and to the northern line running up
  to Lira.

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Uganda new energy projects

• Given the capital intensity of the power
  investments and in line
• with governments commitment to attract
  private capital and
• expertise in the provision of utilities, the
  sector has been opened to private investment.
• Government concluded a power purchase
  agreement and implementation agreement with AES
  Nile Power. The company which is supported by
  Applied Energy Services USA is to build 100 km of
  220 KV lines from Bujagali to the nations main
  load centre Kampala.

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EAC Regional power future plans

• Tanzania and Kenya to be interconnected - 330kV
  line (ZTK Arusha Nairobi),
• Rwanda, Tanzania and Burundi to be interconnected
  through Rusumo Falls Project (NBI)
• Rwanda and Burundi plan a 132kV interconnection.
• Kenya - Uganda 220kV to be interconnection
  (Lessos -Jinja estimated to cost US 94M)
• 220kV line Rusumo Kyaka to Uganda
• Others
• Zambia-Tanzania-Kenya (expected cost US 1 B)
• 400 kV Kenya Ethiopia link (cost US600M)

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Burundi energy distribution systems

• Burundi relies traditionally on hydroelectric
  power generation. In 1959 electrification began
  with a 70 kV overhead electrical line from Rusizi
  I Small Hydropower Plant (SHP) of Congo for the
  supply of the capital Bujumbura.
• In 1982 the first national SHP plant (Mugere 8
  MW) constructed with support of China resumed
  supply for Bujumbura.
• By 2002 the electrical network was supplied by 9
  national SHP with a total installed capacity of
  30.9 MW and 2 foreign SHP plants (one of
  SNEL-Congo with 4 MW, another of SINELAC-CEPGL
  13.3 MW).
• There is additionally an installed capacity of
  thermal power of 5.5 MW (2x1.5 MW, 2x1.25 MW)
  which was put in place in 1996 for auxiliary
  supply services of Bujumbura. /Regideso, 2002/
• Lately by 2003, recorded electricity production
  was about 131 GWh, 99 of which was
  hydroelectric. Total electricity imports
  accounted for 35 GWh, losses for 9 GWh.

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Past present energy projects

• A project for the Rusizi hydropower development
  foreseeing the installation of a 50 MW unit
  (Rusizi II) is currently proposed for financing
  to the African Development Bank /AfrDB, 2006/.
  The Rusizi II plant was to be jointly operated by
  Burundi, Congo and Rwanda. The Burundi share of
  the installed power was expected to be 13.3 MW
  /Regideso, 2002/.
• Another Project proposed sometime back for loan
  application to AfrDB is the Rusumo Falls
  hydropower station (RFHS). The site for this 60
  MW project was to be at the border between
  Tanzania and Rwanda on the Kagera River.
• The country is currently seeking investments to
  construct the two new hydro plants mentioned
  above, to meet its foreseen energy deficit within
  the near future.

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Rwanda energy systems

• Rwanda currently suffers a severe continuous
  production capacity deficit and a current deficit
  in energy resources. The lack in generation
  capacity has been masked by overuse of
  hydro-resources and imports above contracted
  levels. However, possibilities have now ceased
  given growth in demand in the last year of around
  25.
• Despite severe load shedding, lake levels have
  fallen to a minimum since January 2004 and 40 of
  Rwandas electricity demand cannot be served.

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Energy areas for investment

• The proposed investment is therefore for the
  extraction and processing of methane, for its
  conversion into electricity at Kibuye and for its
  transmission through a new line into the Rwandan
  grid.
• The pilot and first 10MW plant will require donor
  funding. the Government of Rwanda is looking to
  finance directly or through a private partner
  around 25 of the cost of the first 30MW plant,
  and 50 of the second 30MW plant.

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Potential investment areas on energy

• Project Location Capacity (MW) Capital
  Cost (M 10 6)
• Bujagali 5th unit Uganda 50 26.4
• Kalagala Uganda 450 511.6
• Karuma Uganda 200 428.9
• Ayago North Uganda 304 557.6
• Ayago South Uganda 234 437.2
• Murchison falls Uganda 420 511.7
• Masindi Uganda 720 1, 633.3
• Ewaso Ngiro Kenya 220 385.9
• Mutonga Kenya 60 196.7
• Low Grand Falls Kenya 140 378.3
• Upper Kihansi Tanzania 120 81.2
• Mpanga Tanzania 144 190.8
• Masigira Tanzania 118 157.0
• Ruhudji Tanzania 358 384.0
• Rumakali Tanzania 222 351.3
• Mandera Tanzania 21 42.1
• Stieglers gorge Tanzania 1200 1, 067.7

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EAC Strategy on scaling up-access to modern energy

• Four service lines
• 1. Policy harmonization-forum for regional
  policy discussions
• 2. Regional capacity building of key
  institutions
• 3. Investment formulation - fund mobilization
  for national investment programs
• 4. Strategic coordination and program management
  managing attainment of targets.

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Major challenges

• 1. Low level technology in geological mapping
  and surveys in
• the region limits energy exploration and
  production,
• 2. Low financial resource base limits both
  public and private
• investment in the energy sector,
• 3. High level research is needed in order to
  find alternative
• sources of energy i.e, solar, wind and
  molasses,
• 4. Climatic changes.

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• Thank You!
• Ahsante!
• Merci!
• Murakoze!