TANZANIA

ELECTRICITY
REGULATORY
INFORMATION
BOOKLET

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 TANZANIA
ELECTRICITY
REGULATORY
INFORMATION
BOOKLET
ii
 FOREWORD

The Energy and Water Utilities Regulatory Authority

(EWURA), has published this information booklet for
providing requisite information on how to invest in the
power sector in Tanzania. This booklet provides basic
information and link to specific information which one
needs to know concerning registration of power projects
less than 1MW, licensing of projects from 1MW and
above, approval of initiation of procurement of large
power project above 10MW, approval of power purchase
agreements and tariff settings.

It is our belief that the information provided in this booklet

will ease the process of obtaining information required by
potential investors (local and foreign) who are interested
to invest in the electricity sub-sector in Tanzania Mainland.

………..………………………….
Felix Ngamlagosi
Director General
EWURA

January, 2017
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 CONTENTS

1. INTRODUCTION ..................................................4
2. REGISTRATION OF POWER PROJECTS .............6
3. LICENSING OF POWER PROJECTS ...................7
3.1 Licence ..........................................................7
3.2 Provisional Licence ........................................9
4. LICENSING OF ELECTRICAL INSTALLATION
PERSONNEL .....................................................11
5. APPOVAL OF INITIATION OF PROCUREMENT
OF POWER PROJECTS ABOVE 10MW .............13
6. APPROVAL OF POWER PURCHASE
AGREEMENTS (PPA) .........................................15
6.1 Standardized Power Purchase Agreement
(SPPA) for Small Power Projects (SPP) .........16
6.2 Power Purchase Agreements (PPA) for
Large Power Projects (LPP) .........................16
7. APPROVAL OF TARRIFS....................................18
7.1 Projects size of up to 10 MW .......................18
7.2 Projects size of above10 MW .......................19
7.3 Retail Tariffs..................................................20

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LIST OF ACRONYMS

EIA Environmental Impact Assessment

EWURA Energy and Water Utilities Regulatory
Authority
GoT Government of Tanzania
LPP Large Power Project
MEM Ministry of Energy and Minerals
MoU Memorandum of Understanding
MW Mega Watts
PPA Power Purchase Agreement
RR Revenue Requirement
SPD Small Power Distributors
SPP Small Power Project
SPPA Standardized Power Purchase Agreement
SPPT Standardized Power Purchase Tariff
TANESCO Tanzania Electricity Supply Company
TEDAP Tanzania Energy Development and Access
Project
TIN Taxpayer Identification Number
VSPP Very Small Power Project
WGSPD Working Group on Small Power Project
Development

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1. INTRODUCTION
The Energy and Water Utilities Regulatory Authority
(EWURA), has broad objectives, including protecting
stakeholders’ interests and ensuring service
providers’ financial viability is sustained. In achieving
these objectives, EWURA, among other things,
issues licenses, formulates and enforces quality
codes and standards, reviews and determines
rates and charges, approves Power Purchase
Agreements, ensures security of supply, energy
efficiency, and promotes effective competition and
economic efficiency.

EWURA is mandated to carry out both technical and

economic regulation of the electricity sub-sector.
This mandate is derived from EWURA Act, Cap. 414
and the Electricity Act, Cap.131. Promotion of least
cost and security of supply is among the functions of
EWURA stipulated in Section 6 of the Electricity Act,
Cap.131. Section 5 of the Electricity Act states the
powers of EWURA regarding regulation of electricity
sub-sector among which is to award licences to
entities undertaking or seeking to undertake a
licensed activity, approve and enforce tariffs and fees
charged by licensees, approve licensees’ terms and
conditions of electricity supply and approve initiation
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of procurement of new electricity supply installation.
Section 8 of Cap. 131 states activities that require to
be licenced, Section 23 of Cap. 131 states EWURA’s
mandates on tariff settings, while Section 25 of Cap.
131 states the mandate given to EWURA when it
comes to approval of power purchase agreements.

In implementing its functions, EWURA prepared this

booklet to provide handy information to investors in
the sub-sector that will enable them to spend less
time in acquiring the necessary information required
for them to fulfil the legal and regulatory requirement
for their projects.

This Booklet summarises the necessary procedures

to be followed by power projects investors to enable
them obtain the necessary approvals required from
EWURA. The booklet covers issues of procedures for
initiation of procurement of power projects, licencing
of electricity activities and electrical installations
personnel, exemptions from licencing requirement,
approvals of Power Purchase Agreements (PPAs),
tariffs and charges.

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2. REGISTRATION OF POWER PROJECTS
Pursuant to section 18 of Electricity Act Cap 131, and
the Electricity (Development of Small Power Projects)
Rules, projects below 1 MW are exempted from
obtaining licences. Projects below 1 MW are required
to be registered by EWURA in form of Registration
Certificate after commissioning of the project.
The Authority may effect a provisional registration
of an SPP or VSPP which fulfils the registration
requirements at any stage before commissioning of
the project by way of a letter. Registration is done
by filling in the application form (form No.5) which
can be downloaded from the EWURA website www.
ewura.go.tz and providing the following supporting
documents:
(a) a dully filled application form;
(b) Certified copies of the registration documents
including Memorandum and Articles of
Association, Certificate of Incorporation and
Taxpayer Registration Number (TIN);
(c) Certified copy of Title Deed or Lease
Agreement;
(d) Environmental Impact Assessment (EIA)
Certificate or any environmental clearance from
NEMC;

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 (e) Water Rights (if applicable) for hydro generation
projects;
(f) Business Plan;
(g) Generation type and capacity/description of the
generation plant;
(h) Number of customers and contracts (if
applicable);
(i) Final designs diagram (as built diagram); and
(j) Commissioning Report.

3. LICENSING OF POWER PROJECTS

3.1 Licence
Pursuant to section 8 of Electricity Act Cap 131, and
the Electricity (Generation Services) Rules, projects
from 1 MW and above are required to obtain licences.
Licensing is done by filling in the application form
(form No.100) which can be downloaded from the
EWURA website (www.ewura.go.tz) and providing
the following supporting documents:
(a) a dully filled application form, attested by
Commissioner for Oath;
(b) Memorandum and Articles of Association;
(c) Certificate of Incorporation;
(d) Certified copy of taxpayer Registration Number
(TIN);
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(e) Company Profile;
(f) Certified copy of Title Deed or Lease
Agreement (applicable for sale of electricity to
off-taker, not needed for own use generation);
(g) Power Purchase Agreement (applicable for
generation project);
(h) Support document of the project from the local
government;
(i) A letter showing support of the initiative from
the Ministry of Energy and Minerals;
(j) Environmental Impact Assessment (EIA)
Certificate;
(k) Occupational Health and Safety Certificate;
(l) Proof of availability of electricity for sale
(applicable for distribution project); Applicant
may provide PPA, MoU or Letter of Intent;
(m) Right of Way (applicable for distribution project);
(n) Water Rights if applicable (for hydro generation
projects);
(o) Feasibility Study;
(p) Description of the distribution network including
customer base/Supply Agreement, number of
transformers and capacities, interconnection
point and point of supply (applicable for
distribution project);

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 (q) Sketch map of the proposed service area
(applicable for distribution project);
(r) Technical competency and experience;
(s) Proof of financial capability;
(t) Business Plan;
(u) Generation type and capacity/description of
the generation plant (applicable for generation
project);
(v) Site layout;
(w) Single line diagram;
(x) Future expansion plan;
(y) Final designs diagram (as built diagram);
(z) Commissioning Report; and
(aa) Proof of payment of an appropriate application
fee.

3.2 Provisional Licence

One may opt to apply for a provisional licence, which
is a licence issued by EWURA to allow a developer
to conduct preparatory activities such as carrying out
assessments, studies and other activities necessary
for application of a licence. To obtain a provisional
licence one must fill application form (form No.100)
and submit the following supporting documents:
(a) a dully filled application form, attested by
Commissioner for Oath;
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(b) Memorandum and Articles of Association;
(c) Certificate of Incorporation;
(d) Taxpayer Registration Number (TIN);
(e) Company Profile;
(f) Certified copy of Title Deed or Lease
Agreement or proof of land acquisition process
(applicable for generation project);
(g) Water Right if applicable (applicable for hydro
generation project);
(h) Environmental impact assessment certificate
or an initiation of the process to acquire the
certificate;
(i) Power Purchase Agreement or Memorandum
of Understanding or Letter of Intent from
TANESCO (applicable for sale of electricity to
off-taker, not needed for own use generation);
(j) Support document of the project from the local
government;
(k) A letter showing support of the initiative from
the Ministry of Energy and Minerals;
(l) Right of Way (applicable for distribution project);
(m) Pre – Feasibility Study/project write up;
(n) Business Plan;
(o) Proof of financial capability;
(p) Description of the distribution network including
customer base/Supply Agreement, number of
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 transformers and capacities, interconnection
point and point of supply (applicable for
distribution project);
(q) Generation type and capacity/description of
the generation plant (applicable for generation
project);
(r) Construction schedule;
(s) Sketch map of the proposed service area
(applicable for distribution project); and
(t) Site layout (applicable for generation project).

4. LICENSING OF ELECTRICAL INSTALLATION

PERSONNEL
Pursuant to section 8(1) (h) of the Electricity Act,
Cap 131 and the Electricity (Electrical Installation
Services) Rules, any person carrying out electrical
installation activities requires a licence. Furthermore,
all electrical installation activities must be carried
out only by individuals licensed by the Authority.
Electrical installation personnel obtain licences by
filling in the application form (Form 101), which can be
downloaded from the EWURA website (www.ewura.
go.tz) and providing supporting documents of their
education and experience in electrical engineering.
It is a legal requirement for investors to engage
licenced electrical installation personnel who are
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authorised to carry out works in different categories
as follows:
(a) Class A which is issued to carry out electrical
installation works at all voltage levels except
works permitted under Class “L” and “S”.
(b) Class B which is issued to carry out electrical
installation works of medium voltage level up
to 33,000 Volts except works permitted under
Class “L” and “S”.
(c) Class C which is issued to carry out all electrical
installation works not exceeding 400 Volts
except works permitted under Class “L” and
“S”.
(d) Class D which is issued to carry out all electrical
installation works not exceeding 220 Volts
except works permitted under Class “L” and
“S”.
(e) Class S is issued to carry out specialized
electrical installation works and it is further
classified as;
(f) Class “S1” issued to conduct specialized
electrical installation works in all voltages;
(g) Class “S2” issued to conduct specialized
electrical installation works up to 33000 Volts;
(h) Class “S3” issued to conduct specialized
electrical installation works up to 400 Volts; and
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 (i) Class “S4” issued to conduct specialized
electrical installation works of up to 220 Volts.
(j) Class “L” issued to carry out maintenance
works on live lines;
i. “LI “issued to carryout live line maintenance
works up to 400kV, and
ii. “L2” issued to carryout live line maintenance
works up to Medium Voltage (33kV).
(k) Class “W” issued to carry out electrical
installation works under electrical supervisors
who possess licences Class A, B, C or D.

Further information can be obtained from “The

Electricity (Electrical Installation Services) Rules”
which is accessible through EWURA website.

5. APPOVAL OF INITIATION OF PROCUREMENT

OF POWER PROJECTS ABOVE 10MW
Pursuant to section 5 of the Electricity Act, Cap 131
and the Electricity (Initiation of Power Procurement)
Rules, purchasing licensees shall seek EWURA
approval to initiate procurement of new power
projects by lodging written application which contain:
(a) A summary of the project, including the
proposed capacity, site location, generation
technology and the predicted project risks;
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(b) A summary of the project rationale, explaining
the need for the project, the benefits expected
from the project, how the project will meet
projected demand, and how the project fits with
the most recent publicly available version of the
Power System Master Plan;
(c) For a PPP Project the Government Notice
Number specifying such project to be
undertaken under PPP arrangement as
required by Regulation 4 of the Public Private
Partnership Regulations, 2011;
(d) Evidence of the technical and financial
capability of the project developer to
successfully undertake the project;
(e) All relevant project information that have been
prepared prior the date of application including
any feasibility studies, environmental and social
impact assessments, and site appraisals; and
(f) A summary of the procurement process that
will be followed, including:
i. Indicative timeline for the procurement
process;
ii. Key staff on negotiation team; and
iii. Any agreement signed between the
project developer and the Government of
Tanzania in support of this project, including
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 memoranda of understanding, letters of
support and Government guarantees.

However, the requirement for initiation of procurement

of power projects is not applicable to:
(a) The procurement of electricity transmission or
distribution infrastructure, unless directly related
to the purchase of power;
(b) Small power projects; and
(c) Generation projects that are wholly owned and
operated by a purchasing licensee.

6. APPROVAL OF POWER PURCHASE

AGREEMENTS (PPA)
Pursuant to section 25 of the Electricity Act, and the
Electricity (Approval of Power Purchases) Rules, all
power purchase agreements shall have approval of
EWURA. However, this does not apply to the electricity
sold directly to eligible customers and under the
Standardized Power Purchase Agreements including
tariffs for small power projects up-to 10 MW which
are being governed by the Electricity (Development
of Small Power Projects) Rules.

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6.1 Standardized Power Purchase Agreement
(SPPA) for Small Power Projects (SPP)
Pursuant to section 17 of EWURA Act Cap 414,
EWURA approved the use of Standardized Power
Purchase Agreements (SPPA) and Standardized
Power Purchase Tariffs (SPPT) for interconnecting
and selling power to the Main grid and Mini grids in
Tanzania. The SPPA are applicable to projects size
of up-to 10 MW. An SPP developer shall conclude
an SPPA not later than ninety days after a DNO has
delivered a detailed statement of interconnection
costs to the SPP developer. The term of an SPPA
shall be for a period of twenty-five (25) operating
years after reaching Commercial Operation Date.

6.2 Power Purchase Agreements (PPA) for Large

Power Projects (LPP)
Pursuant to Section 17 of EWURA Act, Cap 414,
EWURA approved the use of Model Power Purchase
Agreement for projects size larger than 10 MW
for seven technologies which are hydro, oil, solar,
wind, natural gas, geothermal, and coal power
generation. The purpose of using Model Power
Purchase Agreements is to shorten the negotiation
period and to speed up the approval process. The
specific Model Power Purchase Agreements for the
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seven energy technologies mentioned above can be
accessed through our website (www.ewura.go.tz).

Pursuant to Section 25 of the Electricity Act, Cap 131,

any purchasing licensee who intends to conclude a
Power Purchase Agreement with any other party,
shall lodge an application to the Authority which shall
contain the following:
(a) the initialled Power Purchase Agreement,
together with any project agreements;
(b) details of procurement process used to procure
new source of supply, supporting evidence
of the procurement process, and competitive
procurements, report explaining how bids
are evaluated and justifying the selection of
successful bidder;
(c) the names of a person or firm, both domestic
and international, paid a commission, gratuity
or a fee of not less than fifty thousand shillings
in relation to the procurement or execution of
the agreement in the form provided in the First
Schedule;
(d) a summary of key terms of the agreement,
and a filled in risk allocation table in the form
provided in the Second Schedule; and
(e) details disclosing the project owners, including
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 beneficial ownership of companies and trusts
and any relationship that owners have to
ministers, officials and staff of purchasing
licensee, Ministry or the Authority

7. APPROVAL OF TARRIFS
Pursuant to section 23 of the Electricity Act, Cap 131
and section 17 Cap 414 of EWURA Act, EWURA is
mandated to review rates and charges either when
the application is lodged by the applicant or when
EWURA finds it necessary to do so.

7.1 Projects size of up to 10 MW

Pursuant to the Electricity (Development of Small
Power Projects) Rules, 2016 and the Electricity
(Standardized Small Power Projects Tariff) Rules,
EWURA has the mandate to set tariffs for small
power projects as follows:

(a) For parties with SPPAs that generate electricity

using hydro or biomass from 100 KW up to 10
MW, determination of tariff shall be based on
technology costs and feed-in tariff as published
by EWURA from time to time.
(b) For parties with SPPAs that generate electricity
using solar or wind up-to 1MW, determination
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 of tariff shall be based on technology costs and
feed-in tariff as published by EWURA from time
to time
(c) For parties with SPPAs that generate electricity
using solar or wind above 1 MW, determination
of tariff shall be as provided during the
competitive bidding process.

Any SPP or SPD that sells electricity to retail

customers, shall charge a tariff that, at a maximum,
shall be limited to the sum of operating costs,
depreciation on capital, whether supplied by the SPP
or SPD or others, debt payments, reserves to deal
with emergency repairs and replacements, taxes,
plus a reasonable return on capital provided by the
SPP or SPD that reflects the risks faced by the SPP
or SPD.

7.2 Projects size of above10 MW

The Authority has the mandate to approve power
purchase price of power projects above 10 MW
resulting from PPA negotiations between the
purchasing licensee and the developer. The financial
model to support approval of the power purchase
price normally comprise of the capacity price and the
energy price.
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7.3 Retail Tariffs
Pursuant to section 45 of the Electricity Act, Cap 131
and the Electricity (Tariff Setting) Rules, EWURA shall,
after receipt of the application from regulated supplier
evaluate and decide on such application based on
the Tariff Application Guidelines, 2009. The regulated
supplier’s tariff application must contain:
(a) the ownership structure of the applicant and
the other entities in which the regulated supplier
has an ownership interest;
(b) the requested regulatory action and the
rationale for such action;
(c) a summary table of current and proposed
average customer bills by customer class as
well as other charges;
(d) the existing annual revenues of the regulated
supplier and the projected revenues if the rate
or charge were adopted as proposed;
(e) options other than a tariff change considered
by the regulated supplier and why each option
was not selected;
(f) implementation status of key performance
indicators, covering technical, operational and
financial indicators of the regulated supplier
for the previous year, the current year and for
the subsequent three years, assuming the
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 proposed rate or charge is adopted; and
(g) information regarding the annual subsidies and
grants received within the past three financial
years prior to the date of the application as
well as forecast of the same during the rate or
charge period.

Tariffs set by EWURA shall be published in the

Government Gazette to be in use for a period of
three years. Furthermore, EWURA may review tariffs
before the period of three years where it discovers
that major changes have occurred in the electricity
supply industry or when any other needs arise.

Further information can be obtained from the Tariff

Application Guidelines and the Electricity (Tariff
Setting) Rules that can be accessible through
EWURA website (www.ewura.go.tz).

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ENERGY AND WATER UTILITIES REGULATORY
AUTHORITY (EWURA)

Plot 11&12 Block D, Along New Bagamoyo Road,

Opp. Makumbusho Village, Kijitonyama,
7th Floor, LAPF Pensions Fund Towers,
P.O. Box 72175, Dar es Salaam - Tanzania.
Tel: +255 (0) 22 292 3513-18
Fax: +255 (0) 22 292 35190
E-mail: info@ewura.go.tz

www.ewura.go.tz
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