Tanzania Energy situation(2020)
Situation Analysis and Framework Conditions
Tanzania has abundant and diverse indigenous energy resources which are yet to be fully exploited. The sources include; wood fuel and other biomass fuels, hydropower, natural gas, coal, uranium, wind, geothermal and solar
[1].
Tanzania’s energy supply depends mainly on biomass. 78.4% of the total population have access to the grid electricity while households connected are 37.7%. The households electrified by solar photovoltaic technology are 30.4% [Rural Energy Agency April 2020].
As a total, biomass makes up close to 90% of the total primary energy consumption in Tanzania. Unfortunately, this leads to the deforestation of 100,000 h per year, of which only about a quarter is reforested.
[2] 63.5% of the households in Tanzania Mainland use firewood as the main source of energy for cooking, followed by charcoal 26.2%, liquified petroleum gas 5.1% and electricity 3.0%. Other cooking energy comprises of 2.2% [Rural Energy Agency April 2020].
Other energy sources are petroleum, which makes up 7.8% of total primary energy consumption, natural gas (2.4%), hydropower (1.2%) and coal/peat (0.3%).
[3] About 6.6 per cent of primary energy needs to be imported, primarily from Uganda (17 MW), Zambia (8 MW), and Kenya (1 MW) [Ministry of Energy June 2020].
Electricity makes up only 0.6% of total energy consumption.
[4] In 2008, 4,414 GWh of grid electricity was generated in Tanzania, of which 2,655 GWh from hydropower, 1600 GWh from natural gas, 119 GWh from coal and 40 GWh from petroleum. Total installed capacity amounted to 1,219 MW, of which 561 MW was hydropower and 658 MW thermal power. The installed capacity by 2019 was 1565.72MW consisting of hydro 573.70MW, natural gas 892.72MW, liquid fuel 88.80MW and biomass 10.50MW [Ministry of Energy June 2020].
So far 73.2% of urban and 24.5% of rural areas are electrified [Rural Energy Agency April 2020].
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Problem Situation
About 50% of the population lives in poverty, out of which 35% is unable to access all of the basic needs including energy services. Available data reveals that the poor spend about 35% of their household income on energy while the better off spends only 14%. Lack of access to modern energy services creates a vicious cycle of poverty for rural communities due to continued limited production opportunities and social facilities
[5].
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Renewable Energy
Solar Energy
The Tanzanian solar energy sector has been fast growing in recent years and solar products are now a common sight in shops and markets throughout the country. Several factors have contributed to this growth. On the supply side, ever-increasing work on research and development has greatly reduced the prices of solar-PV products worldwide. The prominence of China in producing solar panels at a mass scale has reduced prices even further. With 65.3% of rural households having access to electricity, there seems to be specific potential for solar solutions in these areas. Past awareness-raising campaigns by government and NGOs (like Sida/MEM and UNDP/GEF Mwanza) has helped raise knowledge and understanding of solar products among consumers. The decision by the Government of Tanzania to drop VAT and East Africa Community to drop duties on principle solar products has made the solar market very interesting to entrepreneurs and many organisations and commercial institutions dealing in solar products have started their activities in recent years.
Located in the ‘solar belt’, most parts of Tanzania have abundant solar resources throughout the whole year with the low point occurring in July. The lowest annual average is 15 MJ or 4.2 kWh/m2/day and the highest is 24 MJ or 6.7kWh/m2/day. With such high levels of solar energy resources, Tanzania is naturally suitable for application of solar energy as a viable alternative source for modern energy services supply for rural electrification and in general.
Different types of solar technologies exist, with different market dynamics and technological solutions for each one of them:
- Off-Grid Solar Lighting or Pico-Solar Products (1-10W): small, affordable and easy to use - often handheld - products that provide basic lighting and phone charging services to off-grid households
- Solar Home Systems (SHS, 10-200W): a system that includes a solar panel, battery and inverter that can provide a household with electricity for several devices like light bulbs, TV and a small refrigerator. These systems can also be used for institutions like schools and hospitals.
- Mini-Grids for rural electrification: system with several large solar panels, that provides electricity to a number of households in a rural community.
- Solar for power generation: large solar systems set up to contribute electricity to the national grid.
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Off-Grid Solar Lighting or Pico-Solar Products
In recent years, many small scale solar lighting products have entered the Tanzanian market. These off-grid lighting products or systems that are stand-alone, rechargeable and can be installed, assembled and used easily without requiring assistance from a technician have come to be known as ‘pico-solar’ products. They range from solar lanterns to small solar home systems (SMS), from 5 up to 100 euros in price and typically consist of a small solar panel, a rechargeable battery and an LED bulb. Entry-level pico-solar products can only be used for lighting, but the more advanced systems also offer phone charging services. Because of the affordability and ease of use of these products, they are very well suited for rural off-grid households and can serve as an ideal replacement for kerosene lamps that are currently being used for lighting in most Tanzanian rural households. The solar lights can also give school children the chance to study in the evening.
Some general observations about the off-grid solar lighting sector in Tanzania:
- There is a high willingness to acquire solar lighting products among rural Tanzanian household, especially when the device can also be used for phone charging.
- General awareness about the products varies between different parts of the country, depending on awareness-raising campaigns about solar PV that have been undertaken previously.
- VAT and duty exemptions are in place for all solar products in Tanzania, making it a viable and attractive market for suppliers and retailers.
- The main concern is the huge influx of poor quality or fake solar products to the local markets throughout the country.
- Distribution of fairly priced, high-quality solar lighting products to off-grid communities is lacking.
- After-sales services and warranty systems are often not in place or impossible to access for off-grid households.
Many of these issues are being addressed by Lighting Africa.
Lighting Africa
Lighting Africa is a joint initiative of IFC and the World Bank that aims to accelerate the development of markets for clean off-grid lighting products in sub-Saharan Africa. The program mobilizes the private sector to build sustainable markets that will provide millions of people in Africa not connected to grid electricity with clean, affordable, quality lighting products, most of which are solar-powered.
The Lighting Africa program was launched in September 2007 with the goal of catalysing markets for clean, modern off-grid lighting products to light up the homes and businesses of 250 million people by 2030. The program is active in Tanzania and 10 other countries in Africa and has to date contributed to more than 7.7 million people across Africa enjoying clean, affordable, solar-powered lighting.
The Lighting Africa program consists of five main components:
- Quality Assurance. Establishing quality specifications and developing testing methodologies to promote the manufacture and distribution of quality products
- Market Intelligence. Informing the design of suitable products for the African market
- Business Support and Access to Finance. Assisting manufacturers and distributors in achieving their business goals and supporting new business models to deliver low-cost and high-quality off-grid lighting and supporting distributors and consumers to locate potential sources of funding
- Consumer Education. Generating awareness about and building demand for modern off-grid lighting products
- Policy and Regulation. Engaging governments to create an enabling policy and regulatory environment and supporting them in integrating modern off-grid lighting in their electrification plans
The activities of Lighting Africa in Tanzania started in 2008, with an initial market assessment report, followed by the partnering up with the Tanzania Rural Energy Agency (
REA) to undertake a competitive solicitation in 2010 aimed at selecting suppliers of alternative lighting products that would receive funding for targeted distribution campaigns. The implementation of these campaigns was followed by a Policy Report Note that was agreed upon by Lighting Africa sponsors and the Government of Tanzania in 2012. In 2014 the Lighting Africa Tanzania Market Intelligence Report was released.
An overview of the main Lighting Africa approved manufacturers of pico-solar products that can be found on the Tanzanian market in 2014:
A list of some of the main import-suppliers of Lighting Africa approved solar lighting products in Tanzania:
Pre-Paid Solar Energy Services
Another approach to providing clean and affordable solar lighting to off-grid households is through provision of pre-paid solar energy services. Since 2012 such innovative services have been offered to Tanzanian households by the private sector. Examples of two of these (social) enterprises are given below.
Mobisol
To connect up to 10,000 homes with solar power is a part of the business plan of Mobisol Tanzania Ltd., a subsidiary of Germany’s Mobisol GmbH. In the areas of Arusha, Kilimanjaro, Manyara, and Mwanza, the company’s solar home systems shall electrify those not grid-connected. Already for January 2013, 600 new systems were to arrive at the Kakute Ltd./Mobisol headquarters in Arusha. The company began its Tanzanian ventures in 2013 with a current client base of 2,300 in Arusha, according to managing director Allan Demello. Customers pay off their home solar systems in monthly installations via their mobile phones while Mobisol guarantees a one-year warranty for lights and 20 years for the solar panels. The contract also includes free servicing by qualified technicians during the duration of the warranty.
Off-Grid Electric
Off Grid Electric provides affordable, reliable energy services (M-POWER) to individuals and communities that lack such power. It utilizes distributed solar to sell power as a service to customers who suffer from an expensive grid, an unreliable grid, or have no grid access at all. The company borrows the mobile phone industry’s business model and applies it to the provision of light and electric power. It does this through an innovative approach whereby customers pre-pay for electrical services using mobile money. Once customers pre-pay they are sent secure unlock codes via their phones. These codes are then entered into small-scale, radically efficient solar photovoltaic (PV) systems installed in the customer’s home and electricity is provided. Consumers do not buy or finance the systems; they merely pay for the services.
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Solar for power generation
Energy utility
TANESCO does not see solar energy as a main priority for electricty generation for the national net. In the latest Power System Master Plan (2012) the following section is contributed to solar PV: ‘Contemporary solar PV technology is done at small scale level. Application of solar power technology in Tanzania at large scale is not well established. However, in this update solar power was considered, with a potential to undertake pilot project before engaging many players.’
Solar Energy: Best Practice Case Study
RBF for Pico-Solar
SNV (Netherlands Development Organisation) is currently implementing the Results Based Financing (RBF) for Pico-Solar project in Tanzania. This project – funded by DfID through EnDev – aims to improve market access to and use of quality pico-solar products for poor rural and off grid households in the six regions of Tanzania’s Lake Zone. This is done by providing a financial incentive to import-suppliers and a bonus product to retailers, upon verified sale of Lighting Africa approved pico-solar products. Implementation of the project will start in 2014.
Uzi Solar PV project
Tanzania: Best Practice Case Studies Uzi solar PV project started with baseline data collection on existing energy options, analysis of average household energy demands and feasible power options for the island. Solar PV system happened to be more relevant for the island. Fifty households were identified to participate in a pilot project. These households were divided into groups of 5 and each group provided with a 120 Wp solar PV module, a 10 A charge controller and an inverter. The households were responsible for buying their individual batteries. The houses were supposed to be within 300 metres from the selected central household where the module was installed. Each household was designated one day per week to charge its battery and return to connect it to his household circuit. The energy in the battery was enough to take them throughout the week. For customers with televisions, they are allowed to charge two days a week
[6].
For more information on the impacts and benefits of the project, click
here.
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Hydropower
At the moment about 45% of power generated in Tanzania comes from hydro. Over the years the power sector of Tanzania has been dominated by hydropower. However, poor rains in the past few years resulted in a shortage of water to the turbine generating electricity. This was further aggravated by agricultural activities that were going on upstream. As such, Tanzania embarked on a deliberated measure to forge an energy mix which will ensure reliable availability of power for the economy. This deliberate measure involves promotion of increased use of renewable energy technologies (solar, wind, biomass, wastes, micro hydro), natural gas and other locally available energy sources including coal and geothermal.
Estimated total hydro potential in Tanzania is 4700 MW. By end of 2006 installed hydro power was 561 MW. A list of existing hydropower plants can be found in table 1.
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Tanzania Energy Situation - energypedia.info