Ethiopia is a country which is watered down by 12 river basins with their hundreds of tributaries that gust out from its highlands for ages. The Great Rift Valley that literally bisects the nation into two holds huge amount of geothermal energy resources unparalleled in Africa. The ecological diversity of the nation makes it one of the few countries endowed with unfathomable wind farm and huge solar energy resources that remain untapped. If Mother Nature has to be blamed for favoritism, it was for Ethiopia.
A document from the Ethiopian Investment Commission notes that the country’s hydropower potential is at least estimated at 45,000 MW while potentials in geothermal resources are roughly estimated at 5,000 MW. Current national utilization of power generating potential of Ethiopia stands at 2000 MW. Despite this huge potential only 33% of the entire population have access to electricity.
It would be interesting to note that to date Ethiopia has installed power generating capacity out of which 1,980 is generated from hydropower plants while the remaining 20 MW comes from thermal and geothermal resources. GTP 1 projected that the country’s installed electricity generating capacity is expected to reach 10,000 MW by the end of 2015 and the electrification of the nation will kick the mark of 75%. The Gibe Hydro power system has already been put into gird to be followed by Gibe 3 which is near completion. There is a plan to commission Gibe 4 and 5 in the coming years. However, there is still more to be desired.
In lieu of saving hard currency and as part of a strategy to contain the fluctuation of fuel price, in 2008, the government curtailed subsidy on fossil fuel and started the technology of blending ethanol with petrol with the current average mix of 10% of ethanol with 90% of petrol and the projection for 2015 was 25%. Since then, the nation has started to engage in more serious programs on renewable energy as part of the national program of green economy. One of the merits of Ethiopia’s energy strategy its diversity and supplementary nature of the programs.
The Adama wind farm with its 153 MW capacity is the largest wind farm in sub-Saharan Africa. In addition, the Ashegoda wind farm is currently producing 120 MW of electricity. Ethiopia’s wind farms are fast track projects as they take less time for construction compared to other mega projects on energy. They supplement hydropower electricity as they are at their best during the dry seasons when run off on Ethiopian rivers are reduced due to the erratic rains we witness from time to time.
Another wind farm, even larger in size and intended to produce 300 MW, is due to be constructed at Ayesha in the remote eastern desert near the border with Djibouti, an area with strong winds.
Ethiopia has started constructing a geothermal electric power generating capacity of 1,000 MW per year in the Rift Valley. The first phase, which will produce 500 MW per year, will be completed in 2018. The second phase, which will generate
another 500 MW per year, will be completed in 2021.
The introduction of fuel efficient stoves and biofuels in the form of biogas, particularly in the rural areas of Ethiopia has helped to improve the health of rural households and has supplemented their power needs. Regrettably enough, this technology has not been introduced in many parts of rural Ethiopia.
Ethiopia has indeed achieved commendable results in the area of the production of renewable energy. However, given the country’s huge energy needs, the nation faces the challenge of producing more electric power to meet the needs of the economy. The nation’s power needs are growing to the tune of 20 to 25 per cent per year.
Undoubtedly, the completion of the Renaissance Hydro Electric Dam with an output of 6,000 MW will introduce unprecedented improvements in fulfilling the energy needs of the nation and that of the neighboring countries.
What are the economic implications of Ethiopia’s quest for producing more renewable energy? We can look at this issue from the perspectives of domestic and regional dimensions.
The country has planned to boost the manufacturing sector during the GTP 2 period and this would mean that the industrial zones that are already established and those on pipeline need more electric power. Besides, the railway systems that are under completion and those that are commissioned for the GTP 2 period will fully depend on the electric power supply to be siphoned from the central power grid.
The construction of more condos, the expansion of potable water supply systems, the mushrooming of micro and small scale enterprises and other development programs of the nation including cement and sugar factories, the unprecedented flow of investors certainly demand uninterrupted supply of electric power.
Apart from the national demands for electric power, Ethiopia has already committed itself to supply electric power to most of the neighboring countries including Sudan, Djibouti, Kenya and most likely for the Republic of South Sudan. The nation is already pioneering in working towards economic integration between the countries of the Horn of Africa and the larger East Africa.
The nation’s role in supplying energy particularly to the neighboring countries is not limited to its economic dimensions. Cooperation in the energy sector between East African countries is instrumental in promoting peace and cultural cooperation, transfer of technology and mutual capacity building between the nations.
Ethiopia faces more challenges not only in the production of electric power but also in manning and managing continuous supply of power to effectively avoid power outrage particularly in the manufacturing sector. The government has already embarked on linking the institutes of higher learning with government institutions entrusted with generating renewable energy for the country.
The management of catchment areas of the major dams of the country and handling watershed management as well as construction of silt prevention structures needs national level attention. For Ethiopia, a country with no fossil fuel potential, at least to date, focusing on its diverse green energy resources is not a matter of ingenuity in choice but a matter of expediency.
Despite the above challenges, Ethiopia could certainly enjoy being the pace maker of economic development in the African region. Ethiopia can generate a considerable amount of foreign exchange earnings from sale of electric power to neighboring countries. With the completion of the Cairo – Cape Town trans regional highway and the railway network in the sub-region, Ethiopia will have an opportunity to become the hub of Africa’s industrial development.