Ethiopia’s Energy Becoming Most Diversified In Africa

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Written by Dana Sanchez

One of Africa’s largest wind farms and a gigantic hyrdo project are just two Ethiopian renewable energy projects expected to transform the populous nation into one of Africa’s largest energy exporters, CNN reports.

The Ashegoda Wind Farm and the Grand Renaissance Dam mark a major leap forward for a country that spent parts of the last century ravaged by war and famine, according to the report.

The are part of the Ethiopian government’s five-year Growth and Transformation Plan in a bid to rapidly boost its generating capacity over the next three to five years.

Just 23 percent of Ethiopia’s 90 million people have access to electricity. The wind farm is expected to generate power throughout the year, except during the rainy season between June and September.

Both developments will see Ethiopia transition into one of the region’s biggest energy exporters as electric output grows from 2,000 megawatts (MW) to 10,000 MW. More than half of this is expected to come from the Renaissance Dam, according to  CNN.

Further commitments to geothermal power and potential for oil exploration raise the stakes even higher.

Ethiopia is an energy reservoir in the region, said Jerome Douat, CEO of Vergnet, the French wind turbine company contracted to build the Ashegoda wind farm.

“The wind comes from the ocean to the Rift Valley,” Douat said. “We have placed the turbines at 2,200 meters above sea level in one of the windiest places in Ethiopia.”

Vergnet built the Ashegoda site in partnership with the Ethiopian government at a cost of $290 million with loans from France’s largest bank, BNP Paribas, and the French Development Agency.

Ethiopia is aiming to be the region’s major supplier, working with foreign investors to provide power to neighbouring Sudan, Djibouti and Kenya, according to Will Macpherson, sub-Saharan African energy analyst at African Energy Consultancy.

“People in the energy industry, particularly in renewables, say the government is good to work with,” he told CNN. “They deliver on commitments and build good relationships with investors.”

According to the country’s five-year plan, which runs to 2015, the government is also seeking investment in geothermal and biofuel production to offset any problems with wind.

This will diversify the country’s energy supply, and other African nations will soon begin to follow suit, Macpherson said.

In Kenya, a 300 MW wind power project will be commissioned near Lake Turkana in 2015, and the country is leading the way in geothermal. South Africa has also been successful in developing renewable projects, he said.

Macpherson also said Ethiopia is keen on oil exploration in the Ogaden Basin. The field, which lies in the east of the country, is believed to contain vast oil and gas reserves, according to SouthWest energy, a national exploration company, CNN reports.

While Ethiopia still faces major social problems with poverty and living standards, the country is one of Africa’s fastest-growing economies, showing 8.5 percent growth in 2012.

The mega-dam, due for completion by July 2017, is likely to spur economic growth further. At a cost of $4.7 billion, the dam will create 12,000 jobs and generate 6,000 MW of energy, according to the government.

Sitting on the Blue Nile river, the dam will also serve neighboring Sudan and Egypt, despite concerns that Ethiopia will have too much control over a vital water source in the region.

In a further move to boost energy supplies, the Ethiopian government signed a contract in October with U.S.-Icelandic development company Reykjavik Geothermal to develop one of the world’s largest geothermal power projects.

The plant is part of U.S. President Barack Obama’s $7 billion Power Africa initiative to double energy access in sub-Saharan African.

Reykjavik Geothermal will invest $4 billion in the project and provide 1,000 MW of power to Ethiopia by 2018. When complete, it will be Ethiopia’s biggest foreign direct investment, the company said.

At the unveiling of the geothermal project in New York in October, Prime Minister Hailemariam Desalegn said, “My vision is that over the next 30 years, we will need to harness as much as 80,000 MW of hydro, geothermal, wind and solar power, not just for Ethiopia, but for our neighboring countries as well.”