**2.4 Petroleum**

The consumption of petroleum and related products in Tanzania is about 1.54 million cubic metres annually [Casmiri, 2009]. Petroleum is imported from the Persian Gulf and the Mediterranean region. Most of petroleum depots are in Dar es Salaam near the Dar es Salaam harbour. From Dar es Salaam petroleum is transported to up-country regions via trunk roads and some areas by Tanzania Railways. Therefore, for the country to have access to petroleum products, infrastructures such as trunk roads, railways should be passable throughout the year regardless of climatic conditions.

Imported petroleum and related products are widely used in the transport and industrial sectors. It is also used for generating electricity in isolated grid-diesel power stations that have an installed capacity of about 21 MW and are located in Songea, Masasi, Tunduru, Kilwa Masoko, Mpanda, Kigoma, Biharamulo, Ikwiriri, Mafia and Ngara. Petroleum and related by-products are imported and distributed by private companies regulated by the Energy and Water Utilities Regulatory Authority (EWURA) which has the authority of monitoring performance and standards with regards to quality, health, safety and environment, licensing, tariff review of electricity and price control.

The current level of energy demand and supply in the country signifies low level development in the industry sector, transport, and commerce. Industry and urban households depend to a considerable extent on energy sources such as electricity and petroleum products which are either imported (petroleum) or generated in the country (electricity). Traditional segment of the economy, mainly rural households depend on biomass as the main source of energy. Semi-urban and urban dwellers also depend on biomass especially charcoal and firewood as a source of energy for cooking purposes despite the fact that a large number of households in this category have access to electricity.

The demand for modern energy i.e. electricity is growing at a fast rate. From 1990-1998 demand for electricity rose by 4.45 %; from 2003-2006 demand rose by 8% despite a prolonged period of electrical power shedding due to drought and insufficient rainfall for hydropower catchments areas. The demand for electricity is expected to increase from the present value of 925 MW to at least 3,800 MW by 2025 [Msaki, 2006]. Despite low electricity consumption estimated at 14 % for urban areas and about 2% for rural areas, in general, supply is still unable to meet demand. This shortfall is attributed to the country's dependence on hydropower which in turn is affected by climate variation and climate change. To increase accessibility of electricity to both urban and rural areas necessary efforts are needed. In this aspect, the government decided to commit itself to facilitate the increase of use of renewable energy as an alternative solution for increasing accessibility of modern energy to rural areas. Therefore, a number of reforms i.e. legal framework measures, policies and strategies have been formulated and enacted to provide a constructive atmosphere for utilization of renewable energy resources in the country. The following are some of the policies and strategies adopted for the promotion and facilitation of an increased use of renewable energy within the country.
