East Africa is emerging as a hotbed for energy-related investments, not only for its robust economic growth but also for its potential to become one of the largest producers and exporters of oil and natural gas in the world.
The major East African economies are expected to record an above % growth rate through the medium term.
East African nations are focused on energy sector development to achieve Middle Income Economy status over the next decade.
Countries such as Tanzania, Kenya, Ethiopia, and Rwanda, which have traditionally depended on biomass to meet most of their energy requirements, are gradually shifting to modern energy sources to meet the growing demands of the expanding urban population and the rising per capita income levels.
These countries present significant potential for the development of infrastructure related to oil and natural gas, power generation, and transmission and distribution.
Oil and natural gas, coal, and renewable sources, such as hydropower, wind, and geothermal, will be the primary energy sources for these countries.
Solar energy applications will be limited to off-grid rural and institutional requirements.
Over the next - years, Tanzania, Kenya, Ethiopia, and Rwanda will add approximately - MW to their installed electricity generation capacity (cumulatively).
About this report
Tanzania, Kenya, Ethiopia, and Rwanda are key economies in the fast-growing East African region, which is emerging as a hotbed for energy-related investments. The expanding urban population, hydrocarbon discoveries, and the growing demand for modern energy forms, such as electricity and natural gas, will drive a socio-economic transformation wherein countries will look to achieve a middle income economy status over the next decade. Oil, natural gas, coal, hydropower, wind, and geothermal will be the major sources of primary energy for these countries. Over the next 10-15 years, the aforementioned 4 countries are expected to add anywhere between 40,000 MW and 50,000 MW to their installed generation capacity, while hydrocarbon trade will benefit the economies of Tanzania, Kenya, and Ethiopia. Private sector participation through finance and technology, as well as regional energy interconnections, are critical to realising the true potential of the existing energy reserves. Poor infrastructure facilities, the lack of competent local human capital, and inadequate financing sources are significant bottlenecks to energy development in the region.
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