Thu. Jan 21st, 2021

ADB Approves $120million loan for Tanzanian’s Hydro Power Project

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BY Victoria Ogunrinde

The African Development Bank (ADB) on Friday approved a $120 million loan to fund the construction of a 50 MW hydropower plant in Western Tanzania to provide reliable renewable energy to households, schools, clinics and small and medium-sized enterprises in the Kigoma Region of the country.

The hydropower plant’s expected average annual output of 181 GWh will meet the electricity needs of as many as 133,649 Kigoma households.

President, ADB, Adesina Akinwumi in a press statement noted that the approval of the project “is a reflection of the Bank’s commitment to assist the Government of the United Republic of Tanzania to accelerate its transition to more inclusive and sustainable growth through the production of clean, reliable and affordable electricity.”

According to the staement: “The Malagarasi Hydropower project has several components: a run-of-the-river hydropower plant facility; a 54- km, 132 kV transmission line that will connect to Tanzania’s national grid; a distribution network expansion operation that includes rural electrification and last-mile connections; project management and contract administration support; and compensation and resettlement of affected persons.

”The hydropower plant’s expected average annual output of 181 GWh will meet the electricity needs of as many as 133,649 Kigoma households bringing the region’s electrification rate more closely in line with the rest of the country.

“Similarly, the project is expected to create about 700 jobs during construction, cut the region’s electricity generation costs to approximately $0.04/kWh from the current $0.33/kWh, and also reduce reliance on greenhouse gas-emitting fossil fuels. The cost of doing business will also fall because industry will no longer need to maintain costly back-up generators.

“The project aligns with Tanzania’s national Development Vision 2025 and its Second Five-Year Development Plan (2016/17 – 2020/21) and complements other regional initiatives, including the North West Grid 400 kV Nyakanazi-Kigoma transmission line project, which the Bank is financing in parallel with the South Korea Economic Development Co-operation Fund.”

Also, it will directly contribute to the Bank’s Light Up & Power Africa High-5 development priority, which is being implemented through the institution’s New Deal on Energy for Africa strategy.

Commenting on the Board’s approval, the Director of the Bank’s Power Systems Development Department, Henry Batchi Baldeh, stated that the project is “one of the flagship physical infrastructure investments in the Government of the Tanzania’s Development Vision 2025 and Tanzania’s current Five-Year Development Plan, and that it will increase the share of renewable energy in Tanzania’s energy mix.”

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