The Ethiopian government has officially extended an offer to at least 12 global companies to submit financial and technical proposals in order to be part of power production and operations in the country. This is in order to take the privatization process even further.
According to the Minister of Finance (MoF), Ahmed Shidie, who presented his Ministry’s 10 month report before the House of People’s Representatives, a feasibility study is being undertaken to implement the public-private partnership framework to allow the private sector to step in selected energy and transportation projects which used to be considered as a strategic area fully controlled by the government.
The board of PPP is currently undertaking evaluation of projects which includes six solar projects and three hydroelectric projects. On that basis, two projects named Gad and Deucheto Solar Energy projects which have a combined capacity of 250MW are in the pipeline with an estimated cost of US $265m. Request for Proposal (RPF) has also been prepared for Mekele, Wolenchiti and Worarso Solar Projects which generate a sum of 500MW of solar energy with a combined project outlay of US $529m.
It is to be remembered that opening the country’s market was one of the key improvement areas that Prime Minister Abiy Ahmed (PhD) pledged to address when he came into power in 2018. Similarly the government announced that it will soon be opening its doors for major state-owned firms.
Ethiopia’s clean energy potential
Ethiopia receives a solar radiation of 5000-7000 Wh/m squared according to region and season. Therefore it has great potential for the use of solar energy. The average solar radiation is more or less uniform, around 5.2 kWh/m2/day. The values vary seasonally, from 4.55-5.55 kWh/m2/day and with a location from 4.25 kWh/m2/day in the extreme western lowlands to 6.25 kWh/m2/day in Adigrat area, northern Ethiopia is still at its early stage.
Ethiopia’s hydropower potential is estimated similarly up to 45000MW. It is the second highest in Africa. Only Democratic Republic of Congo has a higher potential. Approximately 30,000MW is estimated to be economically practical which is equivalent to an electricity generation of 162 TWh.