OPEC Fund supports new power line for cleaner power in Tanzania

The OPEC Fund for International Development said on Thursday it will provide a USD-60-million (EUR 55m) loan to support the construction of a power transmission line in Tanzania.

The 166-km (103 miles) overhead line will connect the Kagera region in the northwestern part of the country to the national grid, replacing energy supply from Uganda with local hydropower.

The fund said that as a country bordering Lake Victoria, which is fed by the Kagera River, Tanzania has a significant renewables potential. Hydropower facilities at Rusumo and Kakono in its northwestern region with a capacity of 80 MW and 87 MW are expected to come onstream in 2024 and 2030, respectively.

The new transmission line will reduce Tanzania’s dependence on energy imports and ensure improved power supply for one of its poorest regions. In addition, the increase of hydropower generation will enable the country to close costly and polluting back-up thermal power plants.

Several partners will participate in the financing of the project. The OPEC Fund will provide a USD-30-million loan, as a first tranche of a USD-60-million facility. It will be joined by the Abu Dhabi Fund for Development with USD 30 million, the Saudi Fund for Development with USD 12.8 million and the government of Tanzania with USD 2.6 million. Other backers are expected to finance a downstream distribution network that will connect many unserved communities to the grid, says the announcement.

(USD 1 = EUR 0.914)

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