Ethiopia Seeks to Quadruple Power Generation by 2020

Top Feb9

Dr. Engineer Sileshi Bekele, Minister of Water, Irrigation and Electricity said Ethiopia is seeking to bring power to all households by 2025, up from about 30 percent currently.

In an exclusive interview with Bloomberg, he also said the country is seeking to quadruple its power generation by 2020 and expand power sales abroad that now bring in about 90 million US dollars a year.

“We’re focusing on generating from renewable sources,” Dr. Engineer Sileshi said in an interview in London. “We want to be carbon neutral,” he said, adding that he’d like emissions to remain at or below 2010 levels by 2030.

Ethiopia currently gets more than 90 percent of its electricity from hydro-electric plants, benefiting from powerful rivers such as the Nile.

It is now at the beginning of building out other forms of renewable energy, especially geothermal wells that tap the natural heat from underground rock structures in a rift valley that passes through the nation.

“The demand is growing very rapidly – 25 to 30 percent every year, so we are trying to satisfy this demand,” said Engineer Azeb Asnake, chief executive officer of Ethiopian Electric Power Corp.

“We also have a lot of industrial parks coming up — agriculture industry and the like — with more than 12 under construction or under operation. We really need to provide power to all this demand.”

It’s not the first time Ethiopia set out ambitious plans for power generation. In 2014, Ethiopian officials told the Financial Times they wanted 11 gigawatts of capacity within three years.

Capacity today is about 4.3 gigawatts, almost double the previous figure. Dr. Engineer Sileshi is now targeting 17 gigawatts by 2020.

The Ethiopian government has signed 25-year power purchase agreements with Reykjavik Geothermal Ltd., a developer led by Michael Philipp, the former head of Europe, Middle East and Africa for Credit Suisse Group AG.

“Ethiopia has some of the best geothermal reserves in the world, certainly top 10, maybe top five,” Michael Philipp, chairman of Reykjavik Geothermal, said by phone.

“Geothermal is a very underdeveloped sector, only about 1 percent of the world’s reserves have been developed, so there’s significant upside to getting that right.”

Reykjavik Geothermal is an Icelandic company that’s working on two projects in Ethiopia, Corbetti and Tulu Moye. Each is expected to cost about 2 billion US dollars.

They will have capacities of 520 megawatts apiece, which together is about the same as a nuclear reactor working at full tilt, and will be located 250 kilometers (155 miles) south of the capital city of Addis Ababa.