By Business Insider Reporter
The country’s energy sector is set for a transformative leap following the African Development Bank’s (AfDB) approval of a major financing package for electricity and clean energy access projects across East Africa.
The announcement, made on 28 July, signals a new phase of regional energy integration and infrastructure modernisation – with Tanzania emerging as one of the key beneficiaries.
The AfDB has committed US$282 million towards a flagship project in Tanzania that will connect Zanzibar and Mafia Islands to the national grid via high- and medium-voltage submarine power cables.
The project aims to triple the power supply capacity from 143 megawatts to 440 megawatts, dramatically enhancing electricity reliability in island and coastal regions.
The investment will not only resolve long-standing power supply issues in underserved island communities but also deliver wider economic and industrial benefits across Tanzania’s southern and coastal zones.
By connecting 465,000 new consumers to the national grid and equipping 335,000 users with clean cooking solutions, the programme is expected to significantly boost electrification rates, reduce reliance on charcoal, and support Tanzania’s ambition to reach 75% national energy access by 2030, up from the current 46%.
Furthermore, the inclusion of clean cooking devices indicates a deliberate pivot towards sustainable household energy solutions.
With Tanzania’s forests under threat from unsustainable biomass use, this component of the project is vital for environmental protection, public health, and gender equity – especially in rural areas where women and children are most affected by indoor air pollution.
Catalysing economic growth
a remains one of the primary bottlenecks to Tanzania’s industrialisation agenda.
The new infrastructure will not only serve households but is also expected to support productive uses of energy in agriculture, manufacturing, and services.
The expansion of reliable electricity to Zanzibar and Mafia, both with tourism potential and growing commercial activity, could unlock new investment and employment opportunities.
Moreover, improved energy connectivity strengthens the country’s prospects as a regional logistics and industrial hub. As Tanzania develops energy corridors connecting ports, inland industrial parks, and neighbouring countries, the AfDB-backed grid extension is expected to improve load distribution, stabilise voltage, and support mini-grid integration in off-grid areas.
Momentum for PPP
With the AfDB as a key partner, Tanzania may also see renewed momentum in public-private partnerships (PPPs) in the energy sector.
Private investors are likely to find enhanced confidence in a government-backed, multilateral-financed expansion programme that prioritises both grid reliability and renewable energy integration.
The project could pave the way for further solar, wind, and hybrid energy investments, particularly in regions that remain underserved.
Regional integration
Tanzania’s inclusion in the broader East Africa energy package – alongside Rwanda and Zambia – signals growing regional coordination in energy development, which may open avenues for cross-border electricity trading under the Eastern Africa Power Pool (EAPP).
As regional demand for clean energy rises, Tanzania’s improved transmission infrastructure could position it as a key player in exporting surplus electricity.
With US$282 million in AfDB financing, Tanzania is poised to not only accelerate energy access but also to position energy infrastructure as a strategic enabler for inclusive economic growth, climate resilience, and industrial competitiveness. he ripple effects of this investment – from rural electrification to industrial productivity and environmental protection – are expected to shape the country’s energy trajectory for the next decade.
