Rwanda
With a cumulative score of 1.48, Rwanda ranks number 52 among emerging markets and number 81 in the global ranking.
- Emerging markets
- Middle East & Africa
1.63 / 5
Power score
1.12 / 5
Transport score
Buildings score
Only 56 markets (28 emerging markets) are scored on the Buildings sector. See the full list on the methodology page.
Low-carbon strategy
Net-zero goal and strategy
Rwanda does not yet have a policy to reach net-zero emissions.
Nationally Determined Contributions (NDC)
Rwanda’s updated ‘nationally determined contribution’ (NDC) – meaning its official plan to meet the goals of the Paris Agreement – aims to reduce CO2 emissions by 16% versus a business-as-usual (BAU) scenario by 2030. This is equivalent to an estimated mitigation level of 1.9 million metric tons of CO2 equivalent in 2030, and is based on domestically supported and implemented mitigation measures and policies.
With international support and funding, Rwanda says it could achieve a further 22% reduction in CO2 emissions versus BAU by 2030, equivalent to mitigating an estimated 2.7 million tons of CO2 equivalent in that year.
Combining these unconditional and conditional contributions, Rwanda could therefore lower its CO2 emissions by 38% relative to BAU by 2030, mitigating up to 4.6 million tons of CO2 equivalent in 2030.
Fossil fuel phase-out policy
Rwanda does not have a fossil fuel phase-out policy. However, it has introduced a few policies to displace fossil fuel energy consumption and generation, including hydropower development, dissemination of modern, efficient cooking stoves, and solar pumping for irrigation to replace diesel pumps.
Power
Power policy
As Rwanda targets 100% electrification, it has shown great progress for Sub-Saharan Africa. By the end of 2019 – the last year for which there is complete data – the country had attained an electrification rate of 51%, compared to 10% in 2010. The national strategy aims to reach the 100% target via 52% on-grid connections and 48% off-grid solutions, such as solar home systems and mini-grids. State-owned utility Rwanda Energy Group (REG) says that 37% of households are currently connected to the national grid, while 14% access electricity through off-grid solutions.
Power policies
Power prices and costs
Small hydro remains the most popular source of electricity generation in Rwanda due to the strong network of rivers, accounting for just under 51% of the total mix. The country also relies on solar, natural gas and diesel, and takes advantage of methane from gaseous lakes in the southwest to produce power.
Rwanda’s installed generation capacity has grown by 180% since 2010, reaching 235 megawatts (MW) in 2020. Energy Development Corp., a subsidiary of REG, has been the most prominent developer, but there are also multiple private players involved in Rwanda’s generation sector.
Power market
Electricity prices in Rwanda are among the highest in East Africa, and commercial and residential tariffs have increased considerably since 2010. The biggest driver of this is ‘take-or-pay’ contracts administered by REG. These contracts compensate developers for the contractual offtake from their projects even at times when power cannot be taken. On top of that, the power purchase agreement (PPAs) are signed in dollars and are exposed to currency and commodity price fluctuations. As a result, retail electricity is highly subsidized by REG and the government of Rwanda.
Installed Capacity (in MW)
Electricity Generation (in GWh)
Utility privatisation
Which segments of the power sector are open to private participation?
Wholesale power market
Does the country have a wholesale power market?
Doing business and barriers
Rwanda prides itself on being one of the best markets to do business in among Sub-Saharan African countries and has an appetite for domestic and foreign investment to serve its fast-growing economy. The Rwanda Development Board has been created to support private sector players entering the country, complementing the strong presence of commercial and donor-backed lenders on the ground.
Being a landlocked country, importing components into Rwanda is an expensive endeavor, even if most pieces are exempt from value added tax. Access to local credit is a key challenge for off-grid companies, along with lack of purchasing power among the broader population. In addition, REG has said that it will not sign any new PPAs with developers, citing the country’s estimated 86MW oversupply of generation capacity.
Currency of PPAs
Are PPAs signed in or indexed to U.S. Dollars or Euro?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Bilateral power contracts
Can a C&I (Commercial and Industrial) customer sign a long-term contract (PPA) for clean energy?
Fossil fuel subsidies
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) down through subsidies?
Fossil fuel taxes
Does the government influence the wholesale price of fossil fuel (used by thermal power plants) up through taxes?
Transport
EV market
Rwanda prides itself on being one of the best markets to do business in among Sub-Saharan African countries and has an appetite for domestic and foreign investment to serve its fast-growing economy. The Rwanda Development Board has been created to support private sector players entering the country, complementing the strong presence of commercial and donor-backed lenders on the ground.
Being a landlocked country, importing components into Rwanda is an expensive endeavor, even if most pieces are exempt from value added tax. Access to local credit is a key challenge for off-grid companies, along with lack of purchasing power among the broader population. In addition, REG has said that it will not sign any new PPAs with developers, citing the country’s estimated 86MW oversupply of generation capacity.
EV policy
The government has yet to implement any substantive policy support in this sector and the EV market remains at an early stage.
Transport policies
Fuel economy standards
Does the country have a fuel economy standard in place?
Buildings
Buildings market
Rwanda’s energy efficiency objectives are to double the efficiency of biomass use and extend the improvement of energy efficiency in the electricity sector by 2030. The Rwanda Building Code also sets minimum design requirements to promote the use of energy efficient technologies in buildings
Energy performance standards
Are there minimum energy performance standards for buildings?
Energy efficiency plan
Does the country have a national energy efficiency plan?
Buildings policy
The government has yet to implement any substantive policy support in this sector and the low-carbon heat market remains at an early stage.
