New energy triangle
Daniel Yona, Tanzania's Minister for Energy and Minerals in Tanzania, says that the country will start selling its border power to Kenya. Tanzania buys electricity from Zambia, which is consumed by parts of the Mbeya and Rukwa regions. Through Tanga, its border region with Kenya, Tanzania will start selling its three megawatts to neighbouring communities in Kenya.
Yona says the Tanzania Electricity Supply Company TANESCO is negotiating with their Kenya counterparts on prices so that the deal can be formally sealed. "Tanzania is well endowed with power sources apart from hydro, and we have not exploited these to the maximum. We could have been exporting power like any other commodity had we done so."
Some experts wonder why Tanzania has been exercising power rationing; others wonder why a big area in the country is not connected to the national power grid, says Yona. With more than 34 million people, only ten per cent of Tanzania's population has access to electricity; of these, only one per cent of the rural population has such access.
Worse still, Tanzania probably has the highest power tariffs in East, Central and Southern Africa - something which has been cited as a stumbling block when it comes to the development of industries and industrialisation. Such high tariffs have also resulted in high prices of local goods and services and they are disincentives to potential investors. Fredrick Sumaye, Tanzania's prime minister, said his government is to spend about 40 billion Tanzanian shillings to offset food, water and power shortages caused by longstanding drought. There are clear signs that this unbudgeted expenditure will result in a mini budget soon - the price of beer has already increased.
Yona says the government is discussing the possibility of buying the plant of the Independent Power Tanzania Limited (IPTL). TANESCO is paying IPTL $2.8 million a month as capacity charges only, and it is currently buying all the 100 megawatts generated by the company in order to avoid power rationing. It is estimated that the government, through TANESCO, is spending not less than $3.6million a month on IPTL alone.
Yona is optimistic that Tanzania will be able to deal with the lack of power capacity by means of various projects that are in the offing. "For
example, there's the Nile Basin Power Initiative, which involves power connection and power trade among all countries around the River Nile. Once this is operational, power shortages in the region will be drastically reduced," he says.
|Contact us | About us | Newsletter | Subscription centre | Advertising|
All material copyright Business in Africa. All rights reserved. Material may not be published or reproduced in any form without prior written permission. Read these terms & conditions. Read our privacy statement and security statement. Powered by Mail & Guardian Online & iafrica.com.