Funding for the project comes under the CIF’s Scaling-up Renewable Energy Program (SREP). The country will receive receive $5m as loan along with $16.73m in grants from the African Development Bank (AfDB).
The Geothermal Energy Development Project in Tanzania is aimed at taking the next step towards the country’s plans to strengthen its national energy sector by making it affordable and to increase baseload sustainability.
Finance from CIF will be used in the development of the Ngozi geothermal steam field in southwestern region of the country. This can showcase the technology’s broad potential to transform the country’s energy sector.
Particularly, geothermal energy has been a promising technology for the country and it has around 15 geothermal sites with an estimated total potential of 650MW. One sixth of this potential can be developed at the Ngozi site, stated AfDB and CIF.
AfDB’s senior climate finance officer and CIF coordinator Leandro Azevedo said: “Today, we are assisting in the first step in the transformation of Tanzania’s energy sector, a transformation that is being built on a sustainable energy source.
“Developing geothermal capacity in Tanzania is an essential part of that transformation and we hope that this project’s success will lead downstream to the installation of a 100 MW power plant and help create the conditions for the development of other geothermal sites in the country.”
Ngozi project has a potential to generate about 100MW and will add to the country’s energy mix of 823GWh per year. Developing such renewable sector in the country can help in reducing its dependency on the electricity imported from neighbouring countries such as Uganda, Kenya and Zambia.