Government of Rwanda and the World Bank today signed the first Energy Sector Development Policy Operation (DPO) financing agreement worth US$ 125 Million (approximately Frw 104 Billion).

The financial support which is in form of a concessional loan will enable fiscally sustainable expansion of electricity services in Rwanda. The operation is built around two pillars: (a) containing the fiscal impact of the electricity sector and (b) improving the operational efficiency, affordability, and accountability of electricity service.

The support is part of a three year DPO series worth US$ 325 million (Approximately Frw 271 Billion) which is a continuation of the World Bank’s current financing in the energy sector in Rwanda worth USD 386.7 Million. This First DPO will be followed by two other series, each worth US$ 100 Million.

The existing World bank funded interventions in the energy sector include Rwanda Electricity Access Scale-up and Sector Wide Approach Development Project (EASSDP) worth US$ 130 Million, Rwanda Electricity Sector Strengthening Project (RESSP) worth US$ 95 Million, Regional Rusumo Falls Hydroelectric Project worth US$ 113.3 Million and the recent Rwanda Renewable Fund worth USD 48.4 Million, which are under implementation.

Speaking after the signing event, the Minister of Finance and Economic Planning Claver Gatete said the DPO would help Rwanda achieve sustainable development of the power sector.

“The Program supported by the DPO series is based on a clear set of reforms that will help Rwanda lay the groundwork for successful energy sector development during the implementation of the National Strategy for Transformation for the period 2017–2024.” Minister Gatete said.

Specifically, the DPO will strengthen planning capacity for least-cost access expansion; Introduce improved accountability and transparency in implementing electrification programs; Strengthen the systematic use of tools to improve the management and service delivery of electricity, especially the recently introduced management information system, to reduce losses in electricity supply, improve quality of service, and enhance financial performance; and contribute to the long-term financial sustainability of the sector.

“The World Bank is happy to be a strategic partner of the Government in the energy sector. Through several operations, the World Bank has supported the Government with expanding access and generation capacity, restructuring Rwanda’s electric utility and improving its efficiency. The proposed programmatic operation supports the Government in taking many of reform measures, initiated in previous World Bank operations, forward in a structured, pragmatic, yet transformative manner.” Said Yasser El-Gammal. 

The Division of Labour (DoL) allows World Bank to be active in Agriculture Sector development, Energy, Social Protection as well as Rural and Urban resettlement alongside other cross-cutting and regional projects interventions.