AfDB Approves €174M for Rwanda Energy Program to Expand Clean Power Access

In a significant step towards advancing energy access and sustainability, the Board of Directors of the African Development Bank Group (AfDB) has approved €173.84 million in financing for the Rwanda Energy Sector Result-Based Financing (RBF II) program, which aims to modernize the country's electricity infrastructure, expand clean energy access, and strengthen institutional frameworks in the energy sector. The announcement was made following the Board’s approval on 14 July 2025.

Complementing this investment, the Asian Infrastructure Investment Bank (AIIB) will contribute an additional €86.92 million, bringing the total funding package to €260.76 million. This joint financing underscores a growing international commitment to Rwanda’s ambitious energy transformation agenda.

A Performance-Based Model for Development

RBF II marks AfDB’s second result-based financing (RBF) operation in Rwanda’s energy sector, following the $305 million RBF I program approved in September 2018. The renewed engagement reaffirms Rwanda’s preference for performance-based funding mechanisms that tie disbursements to the achievement of measurable outcomes.

This model ensures that funds are used efficiently and creates accountability for delivering on key development targets. It also aligns well with Rwanda’s Energy Sector Strategic Plan (ESSP II 2024–2029), which aims to achieve universal access to electricity and promote sustainable energy solutions.

Transforming Lives Through Clean and Reliable Energy

The RBF II program is directly aligned with Rwanda’s development goals and is designed to deliver tangible results across three core focus areas:

1. Modernization and Expansion of the Electricity Network

   • Extension and upgrading of national electricity grid infrastructure.

   • Improved reliability and reduction in transmission and distribution losses.

   • Installation of street lighting systems across 200 kilometers of roads in secondary cities, enhancing public safety and supporting local economies.

2. Increased Energy Access – On-Grid and Off-Grid

   • 200,000 new household connections to the national electricity grid.

   • 850 productive-use customers (small businesses, agro-processors, etc.) connected to electricity, spurring job creation and economic growth.

   • 50,000 additional electricity connections via off-grid solutions, such as solar home systems, targeting remote and underserved rural communities.

3. Clean Cooking and Institutional Capacity Building

   • Provision of clean cooking technologies to 100,000 households and 310 public institutions (schools, clinics, etc.), reducing dependence on firewood and charcoal, and improving public health.

   • Strengthening of Rwanda’s institutional and technical capacity in energy planning, regulation, and service delivery, ensuring long-term sustainability.

Delivering on the AfDB’s High-5 Priorities and Mission 300

The RBF II program supports two of the African Development Bank’s “High-5” priority areas:

• “Light up and Power Africa”

• “Improve the Quality of Life for the People of Africa”

Moreover, it directly contributes to the Mission 300 Initiative, a collaborative effort between the AfDB and the World Bank to connect 300 million Africans to electricity by 2030. Rwanda’s progress under this initiative is considered vital, as it is one of the continent’s fastest-moving countries in electrification, having already surpassed 70% electricity access nationwide as of 2023.

Catalyzing Economic Growth and Climate Resilience

Energy is central to Rwanda’s development vision — enabling industries to operate more efficiently, empowering small businesses, enhancing education and healthcare delivery, and lifting communities out of poverty.

By integrating renewable energy sources, decentralized solutions, and clean cooking alternatives, the RBF II program is also helping Rwanda advance toward its climate change commitments under the Paris Agreement and its Nationally Determined Contributions (NDCs).

Furthermore, the initiative supports gender equality and inclusivity by reducing the time women and girls spend collecting firewood and enhancing their access to income-generating opportunities tied to electrification.

A Model for Results-Based Financing Across Africa

The success of Rwanda’s result-based financing approach could serve as a model for other African countries seeking to accelerate energy access through accountability-linked funding structures.

The African Development Bank Group, under the leadership of President Dr. Akinwumi Adesina, continues to champion RBF approaches in sectors ranging from health to transport — helping governments align investments with measurable, high-impact development outcomes.

As Rwanda embarks on the next phase of its energy journey, the RBF II program stands as a flagship example of how strategic partnerships and results-focused investments can power progress — not just in infrastructure, but in lives transformed.