Published: AUGUST 24, 2022

Primary energy legislation

The Electricity Act of 2008 &

  Electricity rules of 2019

The primary legislation for generating, transmitting, and distributing electricity power in Tanzania is the Electricity Act of 2008. The act further focuses on cross-country electricity trading and rural electrification (Kihwele et al., 2012). In line with this act, the Electricity (Development of small power projects) Rules of 2019 and the electricity (Standardized small power projects tariff) order of 2019 stipulate all prerequisites and undertakings to develop and operate power projects in the country. These recent rules and orders have put forward clear and simplified procedures for the development of mini and off grids in the country which enhance best enabling environment for the development of decentralized renewable energy in Tanzania.

The Energy and water utilities regulatory authority (EWURA)

Regulating the energy sector

Regulation of energy sector is undertaken by the Energy and Water utilities regulatory authority (EWURA) which was formulated under the guidance of Energy and Water Utilities Authorities Act (Cap 414) (the EWURA Act). EWURA is specifically dealing with tariff reviews, licensing, reviewing and approving power purchase agreements, and monitoring performance and standards.

Seeding transformation

National policies to regulate the energy sector

Other key legislations which guide energy sectors are Environmental Management Act 2004 and National Energy Policy (NEP 2015). NEP 2015 allows multiple energy producers to generate power from various sources such as wind and solar. This framework aligns with the National Development Vision 2025 and National Five Years Development plan 2016/2021 that stipulate the need for a stronger, secure, and smart power grid. In Tanzania, particularly from the study area most of the small energy producers, investors and village residents are now starting to benefit from the stipulate pinpointed out from the energy policy 2015 which promote the use and establishment of renewable energy technologies. However, there is a problem with the lack of a clear energy access roadmap which harmonizes the specific prioritization of investing in renewables to cater for fast, affordable, and reliable energy to diverse levels of economy in the country.

Energy for everyone

The Rural Energy Agency (REA)

The state-owned company known as TANESCO has remained with a monopoly over the power supply in the country since independence. However, the government in recent years has allowed involvement of private sector in the generation, transmission, and distribution in the country. In addition, Rural Energy Agency (REA) under the Rural Act of 2005 was established to oversee and implement all rural electrification projects in the country through Rural Energy Fund. In recent years, REA has taken initiatives to extend the national main grid in rural areas coupled with small mini grids through energy fund. These initiatives are posing successful undertakings in socio economic activities especially in peri – urban and rural areas of the country.

Fill the gaps

Challenges for mini grids

The main challenge remains in the highly scattered settlement villages whereby the costs of electricity distribution become very high thus leaving these poor population non electrified. Indeed, the highly subsidized TANESCO and REA electricity tend to pose difficulties for the development of new independent mini grids including solar power plants. The tariffs being charged by the independent mini grids are still expensive and do not compete with electricity powered TANESCO and REA and thus pose a barrier to private investment in renewable energy plants.

Table : Key energy stakeholders and institutional set-up in Tanzania Source: (IRENA, 2017)




Government/Public Institutions


Ministry of Energy

Overarching role of overseeing policies, strategies, and laws within the areas of energy.


Tanzania Electric Supply Company Limited (TANESCO)

It is a parastatal institution within the Ministry of Energy in charge of power generation, transmission, and distribution. It is the main power utility company in the country and provides about 60% of the effective generating capacity of the national grid.


Energy and Water Utilities Regulatory Authority (EWURA)

An autonomous regulatory body that oversees the technical and economic regulation of the energy and water sectors. Its tasks consist of regulating power retail tariffs, awarding licenses and monitoring and enforcement activities.


Rural Energy Agency


It was founded in 2005 as part of the Rural Energy Act to support the Government of Tanzania’s endeavors to

accelerate access to rural areas. Major task: to deal with rural access by co-financing rural electrification programs


Tanzania Investment Centre (TIC)

The primary agency of the government to co-ordinate, encourage, promote, and facilitate investment in Tanzania.” Although not mandatory, the Centre is a one-stop shop for new local and foreign investors because of the incentives offered to projects it approves.


Tanzania Geothermal Development Company

A subsidiary company of TANESCO and became operational in July 2014 with a mandate to be at the forefront of geothermal development in Tanzania.


Local government authorities (LGAs)

They have experience of off-grid production and distribution of energy in their own (mostly urban) areas using decentralized energy systems and mini-grids.


Academic and research institutions


Capacity-building for people working in the

energy sector is offered at various universities and

research and training institutions in Tanzania.


Private sector institutions


Emergency power producers and Independent Power Producers (IPPs)

These are private investors owning power plants of more than 10 MW and currently contributing 40% of the installed electricity capacity.


Small power producers


These are private companies operating small renewables-based power projects (up to 10 MW) under an SPPA to sell power to TANESCO or directly to customers. Many of the small power producers also operate in other business areas such as tea and sugar.


Private solar energy companies

They are organized under the Tanzania Renewable Energy Association but legally permitted to work independently in solar PV installation, importing and selling solar PV products.


Private biomass energy companies

These are companies engaged in the fabrication and supply of improved and clean wood fuel cook stoves.


Civil society Organizations


They include NGOs, faith-based organizations and

renewable energy networks. Up until now, many mini-hydropower plants have been owned, operated, and managed by faith-based organizations.

(This section is part of the Policy Recommendation Report that analysis the landscape of the Energy Sector and Policy in Tanzania. Learn more about it here: )