There is a call to action across the continent of Africa to achieve universal access to energy. In its ambitious plan pioneered by the New Deal on Energy for Africa, the African Development Bank (AfDB) committed to invest US$12 billion between 2016 and 2020 towards its initiative to ‘light up and power Africa by 2025.’ The program is anchored on public-private partnerships for innovative financing in Africa’s energy sector. The Government of Tanzania strives to increase electricity generation from the current 1450MW to 5000MW and improve power connections to 60% of the population by 2020. These plans are outlined in the second Five Year Development Plan (FYDPII) which aims to catalyze economic growth in order for the government to achieve its development vision 2025.
The need to meet the growing demand for energy has become more urgent with the heightened focus on industrialization. The 2016 update of the Power Master Plan highlights that on average, the manufacturing sector is expected to grow by over 10 percent per annum with its share in total exports increasing to 30 percent in 2020. To this end, several projects are in the pipeline including the rural electrification projects being implemented by the Rural Electrification Agency (REA) which aims to power villages by 2021.
Since 2004, Songas, a leading Tanzanian gas-to-power company generating 180 MW, has been helping to power Tanzania’s industrialisation by providing approximately 20% of reliable and cost-effective electricity to the national grid and is currently the most affordable thermal generator of electricity in East Africa. The company also provides the infrastructure that supplies natural gas to various manufacturing operations in Dar es Salaam. TPDC estimates that since Songas began its operations in 2004, it has saved the Tanzanian economy more than TZS 11 trillion.
Songas’ partnership with the Government through its entities, Tanzania Petroleum Development Corporation (TPDC) 28.69%, TANESCO 9.56% and Tanzania Development Finance Company (TDFL) with 7.65% illustrates that collaboration is required if we are to advance in achieving our mutual goals. In the last 5 years Songas has paid approximately TZS 48 billion to the Government in dividends.
Songas remains committed to working in partnership with the government towards achieving the country’s economic goals and power is a critical factor in attaining these goals. We look forward to supporting the government in meeting the growing demand for energy and have proposed the expansion of the Songas Ubungo Power Plant to TANESCO which could increase capacity in the short term by 60MW.
Songas is a leading Tanzanian gas-to-power company generating 180 MW (approximately 20%) of Tanzania’s electricity which is supplied to the national grid and distributed by the national utility, TANESCO. It also supplies natural gas to industrial customers to use in manufacturing processes.
Written by Songas Managing Director, Nigel Whittaker