The Rural Energy Agency (REA) has launched a new financing scheme aimed at accelerating the construction and operation of small-scale fuel stations in rural areas, in a bid to enhance access to safe and affordable energy while addressing environmental, safety, and economic concerns.
Under the initiative, REA will offer concessional loans of up to Sh133 million, with an interest rate of between 5 and 7 percent, to be repaid over a seven-year period.
The plan is part of broader government efforts to ensure that rural communities can access fuel petrol and diesel at reasonable prices through formal and regulated distribution channels.
Speaking at the 49th Dar es Salaam International Trade Fair (DITF), REA's Survey Officer, Mr. Hussein Shamdas, said the programme seeks to eliminate the risks associated with the informal sale and storage of fuel in villages.
“In rural areas, the lack of certified fuel stations means residents often store petrol and diesel in unsafe conditions inside homes, in plastic containers, or drums posing a severe fire hazard,” he said.
“This initiative is designed to replace that reality with proper infrastructure that meets national safety standards.”he added
According to Mr. Shamdas, the absence of fuel stations in many rural settings has also resulted in inflated fuel prices due to transportation costs and supply chain inefficiencies.
In some cases, residents must travel long distances to access fuel, leading to shortages and inflated costs that deviate from government-set indicative prices.
“Beyond safety, this also has serious economic implications. Many unregulated fuel sellers in villages operate informally, depriving the government of significant revenue in taxes and fees. It also undermines environmental safety through frequent spillage and poor handling,” he added.
The initiative aligns with the goals of the 2015 National Energy Policy, which underscores the importance of ensuring nationwide access to reliable and affordable energy in a safe and sustainable manner.
Shamdas called on individuals and entrepreneurs across mainland Tanzania to take advantage of the financing opportunity.
Application forms are available through the official REA website, www.rea.go.tz, or at REA’s pavilion at the ongoing Sabasaba exhibition.
“This is not just a business opportunity; it’s a solution to a longstanding energy access gap in rural Tanzania. We are urging citizens to partner with us in transforming energy access and safety in their communities,” he said.
REA continues to play a pivotal role in extending energy infrastructure to underserved areas, supporting inclusive growth and improving rural livelihoods.
The new fuel station financing programme marks a strategic step in diversifying rural energy access beyond electricity into safe liquid fuels.