LAGOS, Nigeria, Aug. 9 (UPI) -- Approximately 85 percent of Rwanda's population has no access to the electricity grid, leading energy officials to seek "off-grid" solutions.
GVEP International, a charity that battles poverty and climate change by promoting access to modern and renewable energy sources, has produced a report outlining investment possibilities in Rwanda's off-grid electrical sector, which includes solar lanterns and solar photovoltaic systems.
David Disch, GVEP's sustainable markets adviser, wrote the study.
"Our research shows that compared to other countries in the region where bulk sales appear more common, it is important for companies in Rwanda to build a dealer network and market their products in order to achieve sales," he said in a GVEP International release.
"Awareness is still very low in Rwanda but the country has a high potential, despite challenges in affordability. The settlement structure is still very rural. However, companies require support to set up a distribution network and getting the marketing right."
Disch's research indicates a Rwandan family using a solar lantern can reduce lighting energy expenditure about 65 percent compared to traditional fuels, such as kerosene.
On a nationwide scale, annual turnover for solar products are $15,000-$2 million with institutional installations and government tenders contributing the bulk of revenue for these companies. Disch sees Rwanda as a major potential market and production center for renewable energy products.
In the 18 years since the country was savaged by genocide, the Rwandan economy has risen to become one of Africa's most dynamic, registering at least 8 percent annual gross domestic product growth since 2007.
The country nevertheless remains heavily dependent on foreign aid. The document Rwandan Finance Minister John Rwangombwa submitted two months ago indicated about 47 percent of the country's 2012-13 budget is to be funded by donors.
The 2012-13 budget prioritizes energy, roads and agriculture to further reduce poverty.
As Rwanda is classified as a country with moderate risk of debt distress, the country is eligible to receive budget loans from the African Development Bank and the World Bank.
As in many other African nations, China is providing significant assistance.
During a recent interview the Chinese Ambassador to Rwanda Shu Zhan said: "China always listens to the opinions of all parties, especially the local people. We believe that Africans are good at solving their differences by their own ways and we support their efforts. China's assistance to Rwanda mainly focuses on energy, roads, agriculture and agro-industry projects which are in line with Rwandan's needs. We want to help Rwandan people shake off poverty and live a better life."
Rwangombwa recently noted that the government, however, will be forced to increase domestic borrowing to counter the impact of delays in disbursement of funds to the national budget by a number of donor nations, including Britain, Germany and the Netherlands.
Nevertheless, Rwandan Foreign Minister Louise Mushikiwabo said Rwanda has proven over time that it can weather difficult conditions.
"With or without aid, Rwandans will not give up, we shall fend for ourselves as we have always done, in any case, we have done so before," he said.
