Thursday, May 19, 2011

Invest more in power generation, govt urged-Tanzania

The government needs to scale up investment in both new energy ventures and upgrade existing power generation and supply infrastructures to bring the nation’s ongoing power crisis under control.

This was said by the Norwegian Ambassador to Tanzania, Ingunn Klepsvik, during an exclusive interview with The Guardian.

The interview coincided with celebrations of the Norwegian Constitution Day, marked on Tuesday at her residence in Dar es Salaam.

She said while she acknowledges efforts by the government to mitigate the effects of Tanzania’s energy woes, it remains its duty to finance electricity generation ventures in a bid to stabilise power supply. 

“Energy generation is something that should be funded by the government, through private sector initiatives (outsourcing) or through public loans,” Klepsvik insisted.

Klepsvik, who was responding to the question whether a portion of the USD513m due to be given to the Tanzanian government by a Norway-led development consortium under the General Budget Support (GBS) initiative could be better spent on power generation still insisted that the government is better placed to finance the power sector because it is not something that is typically financed with donor money.

“Traditionally that’s been the accepted norm,” she said.

Donor involvement in a country’s energy sector is often marginal, in that they would offer assistance with sector support services such as transmission and management training, but not pour direct funding into power production, she said.

“The big infrastructural issues, new plants and so on; that’s for the government,” Ambassador Klepsvik said, adding that the government could do this on its own, via a public-private partnership or by fully outsourcing generation to the private sector.

“Donor money (should be) on the outskirts…in areas such as transmission lines, organisational and management issues,” she insisted.

Her views comes as Tanesco starts a countrywide load shedding today to give room for the maintenance of the natural gas pipelines and Songosongo wells.

Already the prices of generators, rechargeable lights and other electric related commodities have been hiked as a result of power shedding, according to investigation by this paper.
The envoy said: “There is a great need for huge investment both in new energy production and in the maintenance of current production (infrastructure)”.

Reiterating Norway’s commitment to the GBS as a framework for aid delivery, she said that it has been working well as long as there is effective management of public funds.
She commended the Tanzanian government for making significant strides in that regard, and for its displayed commitment to improving social services.

“I think we have seen a tremendous improvement in the management of public funds,” she said, adding that Norway is cognisant of the fact that the government has scaled up investment in public services such as education, healthcare and construction.

Because GBS avails a lumpsum to the National Budget, it puts decision making in the hands of the people’s representatives in Parliament - they get to decide how the money is used.
If a different aid strategy is used, such as direct investment in a specific sector by the donor, Klepsvik said: “The possibility of Parliament having a say on how the money is prioritised is much less.”

She said that with the GBS initiative, it is easier to ensure that Tanzania’s financial system operates cohesively, and it removes the need to micro-manage individual donor-sponsored projects in isolation.
Despite the fact that some donors would like greater influence over how their money is spent, Norway’s confidence in the efficacy of GBS in Tanzania is unwavering.
Said Ambassador Klepsvik: “We don’t see how (donor) money could have been spent better.”

Meanwhile Tanesco said gold mines, factories and other major energy users had agreed to cut down power consumption during the week-long rationing.

Tanesco’s power rationing schedule shows electricity will be switched on after 6 to 10 hours in some areas.
The schedule indicates that while some areas will have rationing between 0800 to 1800 hours, other areas which had power previously will have shedding between 1800 to 2300 hours.

Already the PanAfrican Energy Tanzania Ltd. (PanAfrican Energy) an operator of Songas gas processing plant said the inspection and maintenance work to be carried out over a seven-day period would involve partial and full shutdown of the processing plant.

The company’s General Manager, Andrew Brown said in a statement that partial shutdown will start today (May 19) to May 21 where train 1, which is half of the gas production will be taken offline at 0800 hours and brought back online on the evening of May 21.

He said during partial shutdown from May 22 to May 24: train 2 would go offline at 0800hours on May 22 for a period of 28 hours. “Train 1 would be operational during this period providing half of the production capacity,” it said.

Brown said further that full shutdown will be done on May 23 to May 26 with both trains offline for 72 hours. Both trains will be back on-line midday May 26.

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