Ethiopia to Make USD 20 Billion Investment for Power Development

Addis Ababa, 01 December 2014 (WIC) – During the second phase of the Growth and Transformation Plan (GTP II), which runs from 2015 to 2020, Ethiopia is going to spend a total of USD 20 Billion Birr on its power development program.

Commenting on this Mekuria Lemma, head of Strategy and Investment Division at the Ethiopian Electric Power (EEP), said this expenditure is in line with what the nation has been spending annually in the past three years, USD Two Billion.

The head disclosed this at the “Powering Africa: Ethiopia Meeting”, a meeting held at Radison Blu and organized by the UK-based company, Energy Net Ltd.
The USD 20 Billion is going to be spent on the construction of 10 to 12 additional power generating projects, Mekuria noted. He furthered he wishes to see the finance for these projects to be raised from domestic sources, which are also going to be supplemented with loans.

Construction materials for the projects are mainly going to be supplied from local resources. 60 percent of the inputs are going to be from local sources while the rest 40 percent is going to be covered from foreign investors interested in investing power generating projects in Ethiopia, Mekuria explained.

According to the head, as an incentive the Ethiopian government is going to offer tax cuts for foreign investors. They are also encouraged, with the exception of power distribution, to invest in building, owning as well as operating power generations.

Currently Ethiopia is undertaking different projects targeting to generate close to 10,000 Megawatts. By the end of GTP II, the nation intends to have a capacity of generating a total of 15,000 Megawatt. In addition to this, the government plans to extend the electricity coverage of the country to 99 percent from 55 percent where it stands right now.

According to Mekuria, Ethiopia promotes mix of energy by developing renewable wind and geothermal sources to achieve the intended goals. (Fortune)