The government and the World Bank have signed the first Energy Sector Development Policy Operation (DPO) financing agreement worth $125 million (Frw 104 Billion).
The financial support through a concessional loan will enable fiscally sustainable expansion of electricity services in Rwanda. The operation is built around two pillars: containing the fiscal impact of the electricity sector and improving the operational efficiency, affordability, and accountability of electricity service.
“The programme 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 next seven years, 2017-2024,” explained Finance and Economic Planning Minister Claver Gatete.
The support is part of a three-year DPO series worth $325 million which is a continuation of the World Bank’s current financing in the energy sector in Rwanda worth $386.7m. This first DPO will be followed by two other series, each worth $100m.
The agreement will help strengthen planning capacity for least-cost access expansion, and introduce improved accountability and transparency in implementing electrification programmes.
The DPO will also work towards enhancing the systematic use of tools to improve the management and service delivery of electricity – especially the recently introduced information system management towards reducing losses in electricity supply, improve financial performance, and contribute to the energy sector’s long-term financial sustainability.