20.8°C
20.8°C
The current energy generation (2017) is at 210.9 MW installed capacity. Grid-connected generation capacity tripled since 2010.
Status of energy generation
  • The current energy generation (2017) is at 210.9 MW installed capacity. Grid-connected generation capacity tripled since 2010.
  •  Power Generation mix is currently diversified as follow: hydro power 48%, thermal 32%,  solar PV 5.7% , methane-to-power 14.3%.
Status of access to electricity

According to Rwanda Energy Group Report as of August 2017

  • Rwanda has achieved 40.5% access rate.
  • On-grid access representing 29.5 % and off-grid access representing 11%.
Energy sector plans and targets
  • Rwanda plans to achieve 512MW installed power generation capacity by 2023/24
  • Universal access (100%) by 2023/24; with on grid connections representing 52% and off-grid 48% by 2023/24
Grid Connected projects
1. Hydropower
  • Rwanda’s major Rivers countrywide have proven potential for electric hydropower generation. Thus opportunities exist in micro, small and shared regional hydropower projects.
  • Around 30 companies, both Rwandese and international are currently involved in hydropower projects in Rwanda.
  • 21 mini hydro power plants are operational in Rwanda, supplying electricity directly to the grid under the PPA arrangement.
  • large hydro power plants, currently, 7 grid-connected large plants provide 137.5 MW of generation capacity.
  • Regional hydropower plants are expected in the future. These include Ruzizi III of 145 MW shared with Burundi & DRC and Rusumo 80 MW shared with Tanzania & Burundi, which are at an advanced stage of implementation.
2. Solar Photo-voltaic (PV)
  • Rwanda is located in East Africa at approximately two degrees below the equator. It is generally characterized by Savannah climate and its geographical location endows it with sufficient solar radiation intensity approximately equal to 5kWh/m2/day and peak sun hours of approximately 5 hours per day. Rwanda has High solar irradiance, with 1890kWh/per sqm in the eastern provinces.
  • Gigawatt global has developed the first biggest utility-scale; grid-connected, IPP and commercial solar field in East Africa; the 5MW solar power plant located in Rwamagana, Rwanda Eastern province is operational since 2015.
3. Other sources
  • In order to increase generation and provide affordable electricity, Rwanda’s energy strategy is to diversify sources of energy, by focusing on the development of domestic source and phasing out thermal generation (only keeping the minimum for back up purpose).
  • Besides Hydropower and Solar energy, Rwanda has also potential of 350MW from Lake Kivu methane gas, 300MW from peat, and 490MW from Geothermal

*New grid connected projects are expected in the near future, however they are subject to the power demand and the Least Cost Development Plan for the sake of grid stability.

Off-grid projects (Standalone Solar Home Systems & Mini-grids)
  • More than 60% of Rwandans are in off-grid areas (about 1.2million households).
  • Opportunities exist in supplying Standalone Solar Home Systems (SHS) and building mini-grids for rural electrification to achieve the 48% off-access by 2023/24.
  • The market for Standalone solar systems is growing in Rwanda, and currently a total of approximately 50,000 solar home systems are known to have been installed in Rwanda for the last 3 years.
  • Assessment of 20 potential mini grids locations is being carried out by Rwanda Energy Group (REG),
  • Availability of seed funds including the Scaling-up Renewable Energy in Low Income Countries Program (SREP) and the Result Based Fund (RBF) to make mini-grids sustainable and affordable to Rwandans.
Rural electrification strategy (RES)
  • Rwanda’s Total on-grid installed solar energy is 12.08 MW. Households far away from the planned national grid coverage are encouraged to use Solar Photovoltaic (PVs) to reduce the cost of access to electricity.
  • The Rural Electrification Strategy in Rwanda approved in June 2016 outlines strategies through which Rwanda’s households could “have access to electricity through the most cost effective means by developing programmes that will facilitate both the end users to access less costly technologies and increase private sector participation in the provision of these solutions”.
  • In line with this strategy, the Energy Development Corporation Ltd. (EDCL) signed MoUs with some 24 private companies to increase the supply of off-grid solar home systems, improving the country’s supply chain, bringing solar systems closer to the clients countrywide. As a result, today, 189,069 households are accessing electricity through off-grid solution, mostly solar home systems.

The Rural Electrification Strategy Programmes

Program 1

Provision of subsidy

  • Target 150,000 eligible households within tier category 1
  • Nearly 2000 systems have been installed through various donations
  • Implementation through a tender process, subject to funds availability
Program 2

Provide risk mitigation facility

  • The SREP fund will be used to implement this program
  • Households will access a loan from the SACCOs /Bank and buy a solar system
  • Companies at a later stage will be able to acquire a loan to invest in thier off-grid SHS business
Program 3

Mini grids facility

  • The SERP fund will be used to implement this program
  • Companies will be able to acquire a loan to invest in their off-grid mini-grids
Program 4

Grid extension

  • Target tiers category 3 and 4 households and productive users areas
  • Connecting Minigrids to the national grid
  • Continued roll out grid access program targeting mainly productive users ares

Others (Non-electrical)

1. Biomass
  • As of 2017, 67% of households use traditional stoves (with 79% using firewood and 12% using charcoal, and 0.8% of the households use modern cooking systems)
  • It is targeted to have 16% of households using modern cooking systems by 2023/24. This will represent at least 50% of urban households and 5% for rural households (this means 513,698 extra households in total using modern cooking technologies by 2023:24).
  • There is a need for private sector participation to promote penetration of improved and clean technologies and storage facilities for cooking gas reserves.
2. Biogas
  • To date, 10,558 biogas digesters have been disseminated in households by 63 local companies. The installations costs are borne by the consumers (on their own revenues or credit from lenders) and the government (subsidy) on a 50/50 cost sharing principal.
  • The subsidy is disbursed through the districts which have signed MoUs with local Credit giving institutions (SACCOS) to extend credit to the biogas project owners on request.
  • Small-scale power generation using agricultural residues (such as bagasse or rice husks) or biomass briquettes (from compacted waste residues or charcoal dust) is feasible at low levels of capacity.
  • Rwanda’s transmission network is of 3 main voltage levels; 70kV, 110kV and 220kV transmission infrastructure.
  • By end of March 2017, some 744.7 km of High Voltage (HV) transmission lines had been laid, evacuating power from various points of generation across the country, as well as facilitating regional interconnectivity.
  • Of the total network laid so far, 480.4 km (64.5%) are 110kV and 264.3 km (35.5%) are 220kV transmission lines.
  • There are several opportunities in construction of power transmission & distribution lines, as well as power substations to reach the 52% grid connections by 2023/24 from the current 28.7%. Projects are granted through the normal procurement process by EDCL. Tendered projects are found at this link: http://edcl.reg.rw/index.php/careers/tenders
Power transmission
  • Rwanda’s transmission network is of 3 main voltage levels; 70kV, 110kV and 220kV transmission infrastructure.
  • By end of March 2017, some 744.7 km of High Voltage (HV) transmission lines had been laid, evacuating power from various points of generation across the country, as well as facilitating regional interconnectivity.
  • Of the total network laid so far, 480.4 km (64.5%) are 110kV and 264.3 km (35.5%) are 220kV transmission lines.
  • There are several opportunities in construction of power transmission & distribution lines, as well as power substations to reach the 52% grid connections by 2023/24 from the current 28.7%. Projects are granted through the normal procurement process by EDCL. Tendered projects are found at this link: http://edcl.reg.rw/index.php/careers/tenders
RDB has introduced mandatory online registration for businesses.
Registering a Local Company

In the continued effort to ease business registration, RDB has introduced mandatory online registration for businesses. This makes business registration free of charge, much quicker, easier and more convenient. For more details, please visit www.org.rdb.rw

Electricity Lisence

In order to achieve an efficient, effective, sustainable and orderly development and operations of electricity supply in Rwanda, any activity of production, transmission, distribution, and trading of electric power within and outside the national territory of the Republic of Rwanda is subject to a license issued by Rwanda Utility Regulatory Authority.

Electricity Generation Licenses
License Application fees 500 USD
License Application Transfer fees 500 USD

 

CAPACITY FEES REQUIREMENTS TIMELINE
Above 200 MW 50,000 USD
  1. Application letter addressed to the Director General of RURA
  2.  Original receipt of the application fee payment
  3. Domestic company registration certificate from RDB
  4. Business plan
  5. Copy of the Feasibility study of the project
  6. Environmental Impact Assessment Certificate
  7. Memorandum of understanding/Concession agreement between the Republic of Rwanda and applicant pertaining to the activity to be licensed
  8. Power purchase agreement (not applicable to provisional license)
  9. District authorization approving planned activities, from the District where the target project site is located
  10. Copies of applicant’s financial statements audited by an independent auditor for the previous three years for the existing companies and the initial balance sheet for newly formed companies
  11. Other relevant information detailed in the Electricity Licensing Regulations depending on the type of License applied for
60 Days
From 50MW but less than 200 MW 40,000 USD
From 10MW but less than 50 MW 30,000 USD
From 5MW but less than 10MW 25,000 USD
From 1MW but less than 5 MW 15,000 USD
From 0.5 MW but less than 1MW 10,000 USD
Less than 0.5 MW 5,000 USD

Licenses for mini-grids

The regulator (RURA) developed a simplified framework to expedite licensing of mini-grids and reduce transaction costs. This provides a single license covering the activities of generation, distribution and trade of electricity. It applies to:

  • Small isolated grids : 50kW to 100 kW
  • Medium size Isolated grids :100 kW to 1,000 kW
  • Small power distribution (SPD): small distribution system that is managed independently with less than 20,000 customers

Larger than 1 MW projects are subject to standard licensing regulations. Very small isolated grids (< 50 kW) are exempted from licenses, however RURA needs to be notified before commencement of projects < 50 kW.

Off-grid and Mini-grid Tariffs in rural areas are governed by the ability of households to pay for electricity. A RURA regulation defines tariff principles for tariff calculations. RURA has the right to review tariffs.

For more information, click on the link below:http://www.rura.rw/uploads/media/RURASimplified_Licensing_Regulations_FINAL_APPROVED.pdf

CAPACITY FEES REQUIREMENTS TIMELINE
Small Isolated grid (50KW – 100KW) Exempted
  1. Application letter addressed to the Director General of RURA
  2. Filled Application form from RURA office or website
  3. Domestic company registration certificate from RDB
  4. District Authorization approving planned activities, from the District where the target project site is located
  5. Environmental Impact Assessment (where applicable) Certificate from RDB
  6. Memorandum of Understanding/Concession agreement between the Republic of Rwanda and the applicant pertaining to the activity to be licensed
  7. Business Plan outlining the applicant’s financial and technical capacity to carry out proposed activities
  8. Original receipt of the application fee payment
30-60 Days
Medium size Isolated grid (100KW-1,000KW) 2,000 USD
Small power distribution 1,000 USD

Off-grid and Mini-grid Tariffs in rural areas are governed by the ability of households to pay for electricity. A RURA regulation defines tariff principles for tariff calculations. RURA has the right to review tariffs.

For more information, click on the link below:

http://www.rura.rw/uploads/media/RURASimplified_Licensing_Regulations_FINAL_APPROVED.pdf

Water License for Hydropower projects

Hydropower plants and other users of water resources are required to have the Authorization to use water resource. Below are requirements to apply for a water permit:

  • Recommendation letter from related Ministry
  • Identification of the applicant
  • Site Identification (location, coordinate and map)
  • EIA certificate and report
  • Application fee of thirty five thousand (35,000 FRS) at NBR, on account no 120-28-26 of FONERWA.
  • Register on our System and fill the application form, attach the required documents and then submit when done (https://www.waterpermit.rwfa.rw/users/register)

For more information, click on the link below: https://www.waterpermit.rwfa.rw/login

Investment Process Flow

The process of investing in the energy sector is subject to Public Private Partnership Law if the project is structured as a PPP project.

PPP-PROJECTS PROCESS FLOW FOR PPP PROJECTS
PPP-PROJECTS ON-GRID AND OFF-GRID 1. Solicited Proposals / Competitive Procurement Procedures for PPP Projects 2. Unsolicited Proposals / Procurement Procedures for PPP Projects
Step 1: Conduct a feasibility study for the PPP Project
(Prior to a tender notice, the Contracting Authority must conduct a feasibility study for the PPP Project)
STep 1: Identification of the project
On its own initiative or upon proposal by the Contracting Authority, an investor prepares a PPP Project and submits it to the Contracting Authority for consideration. The Contracting Authority may engage an investor based on an unsolicited PPP proposal where;

  1. There is an urgent need to ensure continuity in the provision of an infrastructure facility or service and it is clear that engaging in a competitive procurement procedure may cause delay or is not in national’s best interests;
  2. The implementation of a PPP project involves matters pertaining to national security
  3. The required service is a monopoly
  4. It is clear that there is little interest of the private sector in investing in the infrastructure sector
  5. or services that the Government considers to be of national interest
Step 2: Approval of the PPP project feasibility study
(
Upon completion of the feasibility study, the Contracting Authority must submit it the feasibility study report to the Steering Committee for approval)
Step 3: Request for expressions of interest
Where the steering committee approves the feasibility study and authorizes the commencement of a competitive procurement process, the Contracting Authority shall proceed to draft the Request for Expressions of Interest and other bidding document.
The Request for Expression of Interest shall be communicated though an advertisement published in at least two widely read national newspapers. Article 16 of the PPP Law provides the minimum content of the Request for the Expression of Interest
Step 4:Shortlist and approval of bidders
The Contracting Authority evaluates the responses submitted by the bidders and creates a shortlist of bidders
The Contracting Authority submits a summary report to the Steering Committee which approves the final shortlist of bidders that will be invited to submit bids
Step 2: Approval of the unsolicited proposal by the Steering Committee
After consideration of the proposal, the Contracting Authority submits a report on the project to the Steering Committee for approval and informs the investor of the decision of the Steering Committee
Step 5: Evaluation of bid documents and approval of the evaluation report
Contracting Authority evaluates the bid documents, compiles an evaluation report and submit it to the Steering Committee for approval
Where the procurement procedure results into the submission of one bid, the Contracting Authority may, make a report recommending the bidder to execute the PPP project and submit it to the Steering Committee for approval.
Where the Steering Committee does not approve the report, it provides guidance on what should be done.
Step 3: Submission and approval of a feasibility study
The investor, on its own initiative or upon proposal by the Contracting Authority shall conduct a feasibility study. The Contracting Authority may conduct the feasibility study itself.
The feasibility study shall be submitted to the Steering Committee for consideration
Where the Steering Committee does not approve the feasibility study, it shall provide guidance on what should be done
Step 6: Negotiation of a PPP Agreement
The PPP Agreement is forwarded to RDB which is the institution that is mandated to lead negotiation of PPP Agreements.
RDB to work with the Contracting Authority and relevant Government institutions during negotiations of project te
Step 7: Signing of the PPP Agreement
Upon approval of the PPP Agreement by the concerning Parties, the Contracting Authority and the partner will sign the PPP Agreement
Step 4: Negotiation and signing of a PPP Agreement
Upon approval of the feasibility study by the Steering Committee, the PPP Agreement shall be negotiated (with RDB taking the lead of the negotiations) and subsequently signed.

In case of Non-PPP projects, which is the case of off-grid projects aimed at providing different off-grid solutions and systems for the rural electrification, here is the process:

Step 1: Application/Expression of Interest
Interested private company to participate in the rural electrification program has to submit the following:

  1. Letter of Expression of Interest addressed to Managing Director of EDCL
  2. Company profile to prove the company’s experience in off-grid solar systems or solutions
  3. Certificate of loacal company registration from Rwanda Development Board
  4. Any other relevant document supporting the application
Step 2: Review of the Application/Expression of Interest
EDCL conducts due diligence and the review of the submitted application documents
Step 3: Signing of the Cooperation Agreement
Upon approval of the Expression of Interest, the company is invited to sign the Cooperation Agreement with EDCL.

*Note that EDCL does not offer the cooperation agreement for solar lanterns

There is no minimum capital required for new investors registering their projects

Investment Incentives

Eligibility

There is no minimum capital required for new investors registering their projects. However, the following criteria of investment project evaluation will apply before an investment certificate is granted:

  • Non trading activity
  • Creation of quality jobs
  • Transfer of Skills and knowledge
  • Use of local raw materials
  • Potential for export
  • Potential to create backward and forward linkages
  • Innovation and creativity
How to apply for investment incentives

The Rwanda Development has developed an online registration system to make the process more efficient and cheaper. The process involves submitting an application for investment certificate online.

For more details, please visit http://www.rdb.rw/ (go to E-services: investment registration)

Investment incentives

Investors holder of the investment certificate are entitled to the following incentives

Fiscal Incentives
  • Zero Corporate Income Tax, for companies planing to relocate headquarters to Rwanda
  • Preferential corporate income tax rate of 15%,for investment in priority sectors or exporting aat least 50% of the produced, in energy, transportm affordable housing, ICT and financial services
  • Accelerated depreciation rate of 50%for the first year in key priority sectors, e.g. tourism, constructionm manufacturing and agro-processing, education, health, telecommunication, energy and transport
  • Exemption of capital gains,for any registered investor
  • Seven-year corporate income tax holiday, for export investment and projects over $50 million in tourism, health, manufacturing, ICT an enrgy once generated 25MW and above
  • Custom tax & duty exemption, for products used in export processing zones(100%exports)
Non-fiscal Incentives
  • free repatriation, fof capital and assets
  • Quick business and investment online registration
  • Assitance with tax-related services and exemptions
  • Assitance with obtaining visas and work permits, EIA
  • One stop center that provides notary services, migration, etc.
  • Provision of aftercare services to fast track project implementation
  • Regardless of the origin of the investor, all business sectors are open to private investment

Environment Impact Assessment (EIA)

Which projects require EIA?

Projects with identified adverse impacts on environment call for a full EIA process for mitigation measures and thus the Ministerial Order N°004/2008 of 15/08/2008 establishing the list of works, activities and projects that have to undertake an environmental impact assessment highlights some projects as follows; construction and repair of international and national roads, large bridges, industries, factories, hydro-dams and electrical lines, public dams for water conservation, rain water harvesting for agricultural activities and artificial lakes, large hotels public building which accommodate more than one hundred daily, extraction of mines and public land fills among others. Therefore, some energy projects require the Environment Impact Assessment (EIA) before its implementation.

Except, standalone solar home systems all other energy projects irrespectively of the technology or size require an EIA subject to the outcome of the project site visit. However, small projects (below 100kW) are given an EIA Clearance certificate (no need to conduct the study), whereas those with capacity above 100kW require and EIA study.
A list of experts is published by the Ministry of Natural resources and can be accessed through the link: List of EIA Experts 2016-2017 should the developer prefer to use an expert not on this list, he may submit to the Authority for approved

Procedures and application for Environment Impact Assessment (EIA)

The Rwanda Development has developed an online registration system to make the process more efficient and cheaper. The process involves submitting an application for Environment Impact Assessment online. For more details, please visit EIA registration.
Here are the key steps:

  • Step 1: Submitting project brief by Investor/Developer (Online Application)
  • Step 2: RDB conducts site visit
  • Step 3: Conducting the Study
  • Step 4: The RDB issues EIA certificate

Once confirmation of compliance has been made by the RDB, the EIA certificate is provided to the developer upon successful review of the EIA report.

RDB One Stop Center Services Timeline
 TYPE OF SERVICES TIME LIMIT   COST
a) Provision of application forms& Information Immediate Free
b) Processing of investment certificate 2 days 500$USD
c) Access to utilities (water& electricity):
     Connection to the grid 24 hours 30,000 Rwf
     Line extension 1month 6,000 Rwf
d) Processing of exemption on imported goods (Capital goods, raw materials, other investment related inputs ):
     Forms processing 15 minutes Free
e) Collection of non fiscal revenues Immediate Free
f) Notary services 30 minutes Variable fee
g) Immigration services
     Visa & work permit 2 Days 100,000 Rwf
     Renewal of Visa & Work permit 1 Day 100,000 Rwf
h) Environmental Compliance:
     – Project brief checklist Immediate Free
     – Site visit and issuance of Terms of reference 2 weeks Free
     – EIA report review and issuance of EIA Certificate 20 days Free