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Petroleum, hydropower and coal are the major sources of commercial energy in the country

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Tanzania has excellent opportunities for oil and gas exploration and development

Profile

Petroleum, hydropower and coal are the major sources of commercial energy in the country. The biomass energy resource, which comprises fuel-wood and charcoal from both natural forest and plantations, accounts for 93 per cent of total energy consumption in the country.

The electricity subsector is largely dominated by a state owned enterprise, Tanzania Electric Supply Company Limited (TANESCO) which has a vertically integrated monopoly in the generation and supply of electricity in Tanzania.

Energy sector is dominated by biomass based fuels mostly for domestic purposes while Petroleum and Electricity account respectively for about 8% and 1.2%; coal, solar and wind account for about 0.8% of the energy used. Other abundant, but untapped indigenous energy resources include hydropower, coal, natural gas, uranium, solar, wind and geothermal energy.

Private Sector Participation

In order to increase power generation through attracting investment in the energy sector,  the Government in 1992, changed its policy stand to allow private participation in generation.

Regulatory Mechanism

The electricity sub-sector is administered under the Electricity Ordinance Cap. 131 of 1957  and will be regulated by the Energy and Water Regulatory Authority (EWURA) whose bill  of establishment was passed by the Parliament on April, 2001

Opportunities

• Tanzania has excellent opportunities for oil and gas exploration and development in its mostly unexploited but potential sedimentary basins. Geological experts have long suspected that there are considerable reserves off the coast of Tanzania. The Government offers competitive terms of would be investors including economic, legal and fiscal incentives.

• The private sector is invited to participate in developing power generating projects.

• Tanzania has abundant untapped energy resources, some of which could be exploited for electricity generation. Coal reserves are estimated at about 1200mn tons of which 304mn tones are proven. Natural gas is estimated at 44.02bn cubic meters of proven reserves. Hydroelectric energy has a potential of installed capacity of 4.7 GW of which only about 10% is developed.

• Solar, wind and geothermal sources, remain virtually untapped. Very little attempt has been made to utilize this source of energy, which could be a viable alternative source to reduce the use of wood and oil for heating purposes. These energy sources require low investment capital compared to hydroelectricity generation.

• Tanzania has a per capital electricity consumption of 46/KWh per annum, which is growing at the rate of 11 - 13 per cent. Hence the government is encouraging investment to expand generating capacity, distribution system and developing indigenous sources of energy.

• There are other indigenous alternative sources of energy such as coal. Tanzania has 1200m tons, which could provide energy for paper mills, cement factories, agriculture and household consumption, and generation of power.

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 Information Source: Tanzania Investment Centre
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