Bloomberg News

Belgian Agency to Explore Rwanda’s Geothermal-Power Potential

November 15, 2011

Nov. 15 (Bloomberg) -- The Belgian Development Agency plans to spend 55 million euros ($74 million) over three years to explore the potential of geothermal energy in Rwanda, said Erik Van Malderen, co-manager of energy.

The Brussels-based agency hopes to attract investors to the East African country by conducting drilling to prove that about 300 megawatts of energy can be extracted from Rwanda’s part of the East African Rift, a geothermal hot-spot that spans 11 African countries.

“They are a little bit reluctant to invest until it has been proven that there is a resource,” Van Malderen said in an interview yesterday in Kigali. “But there is some interest” from companies, he said.

Rwanda’s economy, still recovering from the 1994 genocide that left about 1 million people dead, doubled in size in the nine years to 2010, according to the World Bank. The government hopes energy projects will cut the price of electricity by 50 percent and reduce Rwanda’s dependence on oil imports.

“If we don’t invest in renewable energy, we will just see prices going up,” Van Malderen said.

Rwanda wants to generate 1,000 megawatts by 2017, up from 100 megawatts currently, which serves 6 percent of the population, according to the infrastructure ministry. Rwanda, Tanzania and Burundi are building a $360 million hydropower plant that could generate 90 megawatts, Van Malderen said.

The Rusumo Falls project may generate as much as 30 megawatts for Rwanda, with construction scheduled to begin in early 2012, he said. The African Development Bank is expected to fund 40 percent of the project, with bilateral organizations funding 15 percent. The governments are seeking financing for the remaining 55 percent.

Van Malderen said Rwanda’s 1,000-megawatt goal is unrealistic and may be less than what it needs. With developments in geothermal energy, hydroelectricity, methane gas and Rwanda’s natural supply of peat, the country may be able to generate 300 megawatts to 600 megawatts in the same time period, he said.

--Editors: Emily Bowers, Hilton Shone.

To contact the reporter on this story: Heather Murdock in Kigali via Nairobi at pmrichardson@bloomberg.net.

To contact the editor responsible for this story: Paul Richardson at pmrichardson@bloomberg.net.


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