Unpacking Tanzania's Sh3.049 trillion energy plan

Tanzania has recently unveiled an ambitious budget of over three trillion shillings for its energy sector, with the aim of increasing energy access and reaching 5,000 megawatts by 2025. Gabriel Mwang'onda, the Managing Director of Segax Group Limited, shed light on how this fund will be allocated and the timeline for implementation. The budget is part of a broader vision outlined by the president to achieve significant milestones in the energy sector over the next few years. The majority of the budget, around 95%, will be directed towards development projects, including the construction of various power production facilities. One of the flagship projects is the Nyerere Dam, expected to generate 2,115 megawatts, along with several smaller hydro and solar projects across the country. The focus on diversifying the energy mix bodes well for Tanzania's energy future, ensuring resilience and sustainability in the face of changing global dynamics.Transmission infrastructure has been a significant challenge in Tanzania, leading to significant energy losses during distribution. To address this issue, the government plans to invest in new transmission lines and upgrade existing infrastructure to minimize losses and improve efficiency. With the completion of several transmission projects and the connection of all regions to the main grid, Tanzania aims to enhance energy accessibility and reliability for its citizens. The country's efforts to enhance its petroleum capacity are also noteworthy, especially in light of recent subsidy cuts on fuel. By establishing a larger depot for storing petroleum products, Tanzania aims to mitigate the impact of global market fluctuations on fuel prices. Moreover, the proposal to create a regional storage facility in collaboration with other SADC members underscores Tanzania's commitment to ensuring energy security and stability in the region. Additionally, the country is prioritizing the transition to cleaner cooking solutions, promoting the use of LPG gas and LNG as alternatives to traditional charcoal. Subsidies and tax reductions are being offered to encourage the adoption of these cleaner energy sources, signaling Tanzania's commitment to environmental sustainability and reducing carbon emissions.Gabriel Mwang'onda emphasized the importance of these initiatives in driving down utility costs and fueling economic growth in Tanzania. With increasing electricity demand from various sectors, including mining, the completion of key projects such as the Nyerere Dam is expected to boost energy supply and support economic expansion. As Tanzania strives to become a middle-income nation by 2030, the energy sector's robust development plan plays a pivotal role in achieving this goal. The progress made in harnessing diverse energy sources, improving transmission infrastructure, and promoting clean energy adoption indicates a positive trajectory for Tanzania's energy landscape and economic prospects.