Tanzania’s TANESCO launch on-bill financing for new customer connections to acquire eCooking appliances: a milestone for the sector

By Charles Barnabas (Prime Expertise Ltd.), Anna Clements (Gamos Ltd.), and Jane Spencer (Loughborough University).

TANESCO officially launched the “Konekt Umeme, Pika kwa Umeme” (“Connect Electricity, Cook with Electricity”) initiative on 9^th October 2025; an on-bill financing (OBF) programme designed to directly address the ‘affordability challenge’, the upfront cost of an appliance. Some say that the upfront cost is one of the major barriers of widespread adoption of eCooking appliances in Tanzania. This initiative is part of the implementation of Tanzania’s National Energy Compact under Mission 300, which aims to connect 8.5 million customers by 2030. See a video of the launch event here and read the rest for this blog for more information on the OBF initiative.

The initiative targets newly connected electricity customers, offering them an eCooking appliance such as an Electric Pressure Cooker (EPC) or an induction hob after connection on credit. Instead of paying the full cost upfront, customers repay gradually through their electricity bills, with 25% of every prepaid electricity purchase automatically allocated toward appliance repayment (and the remainder going to electricity units). For example, if a customer makes an electricity purchase worth TZS 10,000, the money is automatically split between buying units (TZS 7,500) and making a repayment to their loan (TZS 2,500). Customers do not need to pay another credit agency, it is all seamlessly tied into their electricity bill.
The official launch took place at Mwembe Yanga Stadium in Temeke, Dar es Salaam, where the initiative was met with widespread enthusiasm. 15 newly connected customers received their EPCs during the ceremony, presented by the Guest of Honour, Hon. Albert Chalamila, the Dar es Salaam Regional Commissioner.

This is a huge milestone for the eCooking, and indeed, clean cooking, sectors. TANESCO are the first utility on the continent to enable customers to pay for eCooking appliances through their electricity bills, smoothing out repayment over time, and therefore lowering the upfront cost barrier of acquisition. This mechanism can help stimulate demand, leading to increased sales in electricity, which supports utilities as they work hard to upgrade, increase, and maintain electricity networks.

The launch marks the start of a pilot phase, involving a sample of households across all regions who are on the normal domestic tariff (T1). These customers tend to purchase electricity more frequently – allowing TANESCO to recoup the appliance cost more quickly. During the pilot phase TANESCO will be assessing performance and customer response and feedback, before scaling up. As the programme scales, TANESCO plans to expand to other tariffs, especially the lifeline tariff (D1), for those in rural areas and who tend to use less electricity, so they too can benefit. We eagerly await this, because it is often those in rural areas who may struggle more to afford to transition to modern cooking, and be facing challenging circumstances of accessibility of alternative solutions, such as being far away from LPG refill points.*

At MECS, we congratulate TANESCO on this major milestone of the TANESCO eCooking Programme. This initiative represents one of the most effective demand stimulation mechanisms available to utilities, and we are delighted to see it being implemented to accelerate the transition to eCooking. MECS started engaging with TANESCO in 2022, and, funded by UK International Development, we have been collaborating on eCooking promotion and accelerating adoption in our eCooking Scale and Support Programme. Being in the position of launching on-bill financing and empowering TANESCO staff as eCooking champions by 2025 is commendable progress, that will surely contribute towards the national goal of 80% of Tanzanians having access to clean cooking by 2034.
 
* While we sometimes hear concern that cooking with electricity might contribute to rural households using more than the lifeline tariff limit (75 units per month), cooking with efficient eCooking appliances is so efficient that it requires very little electricity. If a family transferred around half of their cooking to eCooking (makande, beans, rice- the food most well suited to an electric pressure cooker, for example), they are likely to use only around 1 unit a day.

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Featured photo credit: TANESCO.

No AI was used in the production of this blog.