Ethiopia, Djibouti Sign Renaissance Dam Power Exchange Agreement

Ethiopia, Djibouti Sign Renaissance Dam Power Exchange Agreement

Last Wednesday, the foreign ministers of Ethiopia (Tedrose Adhanom PhD) and Djibouti (Mohamed Ali Youssouf) signed and an agreement that would grant Djibouti power system interconnection access once Ethiopia’s Grand Renaissance Dam project reaches completion, All Africa reported.

While, the dam will provide power for seven surrounding countries in total, Djibouti’s 35Mw-70Mw transmission project will be the second between the two nations and will carry a $2 billion price tag. According to All Africa, both countries will be tasked with raising the funds to implement the project. When the power system is actually up and running, Djibouti won’t be expected to import more than 50Mw of electricity.

“Though we are interested in selling electric power to different countries in the horn, including Djibouti, there is sometimes higher electricity consumption in the Dire-Dawa area. Because of this, they would most likely import only up to 50Mw,” an Ethiopian Foreign Ministry official said in the report.

“We have regularly been doing the task for them. But now, we are expected to do it together.”

All Africa reported that the African Development Bank funded 80 percent of the first Ethiopia-Djibouti power transmission line — a project which provides 60 percent of Djibouti with power and cost $1.5 billion to construct. The report also noted that Ethiopia earns $1.5 million per month from this exchange.

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In addition to solidifying a new power transmission line project, the signing ceremony outlined utilization of Djibouti ports by the Ethiopian Shipping & Logistics Service Enterprise, All Africa reported.

“We are exerting all our efforts to keep Ethiopia’s import and export happening through Djibouti,” Yacin Houssein Douale, director of Bilateral Relations with the Djibouti Ministry of Foreign Affairs and International Cooperation said.

Djibouti is requesting that at least 30 percent of transport services benefit their country. However, according to All Africa, Ethiopia has expressed apprehension regarding transport quotas. Still, the nations are working toward the development of three Djibouti dams that will be constructed over the next ten years.

“Our life is interdependent and our destiny is intertwined,” Adhanom said in the report.

Through the dam’s electric power interconnection capability, Ethiopia plans to establish and continue similar project agreements with Kenya, Uganda, Sudan, South Sudan, Somalia and Egypt, All Africa reported.