Electrification Project Lights up Lives, Boosts Incomes in Rwanda

February 5, 2013

World Bank Group

  • Nearly one million Rwandans gained access to electricity between 2009 and 2012
  • Over 1,400 km of new distribution networks were built and electricity connections tripled
  • Schools and health centers achieved a 70% increase in electricity connections

KIGALI, February 5, 2013—In 2008, only six percent of Rwanda’s 10 million people had electricity in their homes. Even those with access had to put up with frequent power cuts. The low level of access and its unreliability led school principals to suspend computer learning programs. Flagship export industries like coffee and tea produced far below capacity. High fuel costs for back-up generators eroded entrepreneurs’ incomes and limited services provided by health centers.

But this dire situation is changing, thanks to a determined effort by the Government of Rwanda with financing from the World Bank and other development partners. The Rwanda Electricity Access Rollout Program (EARP) has almost tripled connections from 110,000 in 2009 to 332,000 by December 2012.

Lighting Businesses

Having access to electric power has transformed businesses like Jean Claude Habimana’s barber shop in Nyaruguru District, southern Rwanda.  Before getting connected, Habimana served clients with electric razors, lights and music powered by a gasoline-fired generator. It was noisy, polluting—and expensive. While his earnings were $4.75 a day (3,000 Rwandan Francs), he paid US $3.17 a day (Rwf 2,000) for fuel, more than half his total income. But thanks to the EARP, Habimana’s income rose by 30%, while his energy costs dropped by 75%. 

Because two-thirds of Rwandan households are located within five kilometers of the existing grid and connecting them is costly, the project has focused on affordability and energy efficiency. Low-income households are offered ready-to-use switchboards to connect to grid electricity without the need for expensive house wiring.  They can also opt to pay installments over a 12-month period to spread connection costs increasing affordability. In addition, each newly connected household receives three free energy-efficient bulbs that help lower consumption and ease electricity loads.

“At the heart of the World Bank's energy strategy in Africa is supporting transformational projects that achieve large outcomes,” said Lucio Monari, Sector Manager for the Bank's Africa Energy program. “The Rwanda Electricity Rollout Program has helped to triple connections in just three years—a large outcome by any measure, and our Rwandan partners have reason to be proud of this achievement.”

Connecting Homes, Classrooms and Hospitals

Electricity is pulling families out of darkness, bringing technologies to schools, and improving services at health centers. So far, the number of schools connected to the grid has risen by 70%, from 715 in 2009 to 1,226 in 2012. Health centers with electric power have risen in number from 169 to 286.

“The electric light is useful to me and my children,” said Claudette Nyirabazungu of Kigombe, a resident of Kigombe Administrative cell in the northern province of Ruhengeri.  “I can also charge my telephone battery so easily. Life is much better.”

“Electricity is very useful to us,” said Pascaline Uwizera, a first-year student in secondary school. “I can now use a computer and carry out our evening studies properly.”

Before electricity came to Nyange health center in Byumba, northern Rwanda, babies were often delivered in darkness after dusk at considerable risk to expectant mothers and newborns. “Now that we’ve got electric power, all machines are functioning well and the lab is operating perfectly,” said the health center’s deputy director, Spéciose Mukabadege.

Empowering Local Enterprises

Aside from improving the quality of life for Rwandan households, wider and cheaper electricity access has invigorated the Rwandan economy, both small businesses and major industries. Access to the grid makes electric power cheaper for small businesses like barber shops as well as major industries like tea processing plants, making both more competitive and prosperous.

“In the 10 of 15 sectors already electrified, I have seen workshops for carpentry, tailoring and other products spring up. Electricity is being used by villages for irrigation in some areas.  Electricity has changed the district fundamentally, “said Julius Rukundo, Vice Mayor of eastern Rwanda’s Bugesera district.

Coffee and tea are Rwanda’s major export crops. Electrification increased their international competiveness by lowering energy costs. The Mata Tea factory in Rwanda’s southern Nyaruguru District, for example, has reduced its energy costs by at least 50% since its grid connection replaced expensive diesel fuel.  By substituting diesel fuel with electricity for water pumps and lighting, the Maraba coffee washing station in southern Huye District cut energy costs by at least 75%.

The EARP, which was expected to raise electricity connections to 350,000 by the end of 2012 during its first phase, is a vital component of the government of Rwanda’s poverty reduction strategy.  “Enabling productive centers access to electricity is essential to boost the enterprises’ productivity, competitiveness and ability to create jobs,” said Paul Baringanire, the World Bank’s project team leader. 

The World Bank Coordinates Multi-party Support

The EARP is supported by a $70 million zero-interest credit from the World Bank’s International Development Association (IDA) in partnership with the African Development Bank, Arab Bank for Economic Development in Africa, Belgium, European Union (EU), Japan, Netherlands, OPEC Fund for International Development (OFID) and the Saudi Fund which, together, have mobilized $348.2 million for the program.