Energy 4 Impact to involve community members in the development and operation of mini-grids in Rwanda

Energy 4 Impact has said it will involve community members in the development and operation of mini-grids in Rwanda under its Sida-funded Scaling Off-Grid Energy in Rwanda (SOGER) programme,

These will see community-owned cooperatives join forces with mini-grid developers to construct pico-hydro grids at 10 sites across Rwanda, providing clean energy access to about 7,500 people.

According to Victor Hakuzwumuremyi, SOGER Programme Manager at Energy 4 Impact, “Energy 4 Impact has put in place the necessary mechanisms, including hiring of a legal firm to facilitate the establishment of the relationship between the community and the developers. We have ensured the agreements are legally binding and that the benefits generated by the grant-funded pico-hydro plants over their life cycle benefit the community.”

Community members, through cooperative societies, and mini-grid developers will therefore start to jointly design, finance, develop and operate mini-grids to deliver renewable energy in remote areas for household and productive use. Communities can buy-in a project and help raise the required funding.

Some of the community cooperatives working with E4I include Umucyo Cooperative in Mudasomwa, Nyaruguru District and Kodukaru Cooperative in Mpanga Sector (Nyankorogoma Site) Kirehe District. Kodukaru Cooperative holds 44.3% shares in the SPV whilst Nyankorogoma Hydropower Ltd, the developer, holds the remaining 55.7%. In Mudasomwa, Umucyo Cooperative has a 35.4% stake while the developer, Hobuka Ltd, holds 64.6% of the shares in the mini-grid.

Mudasomwa is a 34kW pico-hydro with a cost of around $107,000. The community and the developer in Mudasomwa will raise 10% and 25% of the capital expenditure respectively. The community members will offer their contribution in cash or by working on the project during construction. Energy 4 Impact will offer part of funding through a grant provided by the Swedish International Development Cooperation Agency. The remaining 15% will be raised through debt raised by the developer.

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Construction of the pico-hydro plant in Nyankorogoma will cost around $86,000. Again, Energy 4 Impact will provide part of the funding as a grant through the SOGER programme. The developer will raise 10% of the cost, while community members will raise 7% through a cash contribution or by working on the project during construction. The outstanding 13% will be raised through debt by the developer.

Upon completion, the 11kW pico-hydro power in Nyankorogoma will connect 141 households, 17 commercial centres, three churches and one grain milling machine. Since the community exports unprocessed maize, sorghum and cassava only to import back in processed form, it is expected the newly available power will create a platform for value added processing activities, as well as attracting new businesses to the area.

Energy 4 Impact will advice on markets and supply chains, on the economics of their business case and accessing capital to acquire electrically powered equipment.

The SOGER programme has a strong focus on gender and is implementing gender sensitisation activities across the productive use and pico-hydro sectors. The SOGER project is aligned with the Rwandan government’s vision to achieve 100% electricity coverage by 2020 through blending both on-grid and off grid solutions across the country.

As part of these efforts, Energy 4 Impact is supporting 30 pico-hydro developers in total in Rwanda to set up power plants through grant financing, linkages with other investors or financial institutions and technical support.

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