May 29, 2012

Somaliland: On The List To Receive Power From Ethiopia

An Ethiopian corporation will connect African states through the largest continent electric line installation project.

Below is an article published by Somaliland Press:

The Ethiopia Electric power Corporation (EEPCO) is on the point of embarking on an ambitious project that aims to connect East and South Africa countries on the basis of electric power transmission lines. According to Mihret Debebe, ECO of the corporation, Ethiopia will be at the center of this Eastern African electric highway project selling hydroelectric power to countries. The project, which kicks off by installing power transmission line to Kenya, will be by far the largest electric line transmission installation project in the continent.

“So far, only the border city of Moyale has been connected to the Ethiopian grid system,” said Mihret. However, thanks to the approval of the loan in the order of USD 1.3 billion by the World Bank and the African Development Bank this week, Ethiopia will sell electricity to more towns in Kenya. Mihiret noted that the design and study of the project has already been completed and it is ready to be floated for a bid. The two institutions reached at the decision to provide the loan after deliberating on the matter in Washington last week. Furthermore, Mihret noted that Somaliland is on the list to be the next Eastern African country to receive power from Ethiopia.

In a related story, the EEPCO announced that some 200 billion birr ($11.4b) is required within the next five years [2013-2018] to complete electric power expansion.

Mihret said that it is possible to get that amount of money for the expansion and related works as Ethiopia is becoming trustworthy regarding its massive activities in electric power investment. And this helps the corporation to access loans from different potential lenders. The electric power projects that are arguably the most expensive investments in the country has a budget of over than 42 billion birr ($2.4b) for the current [2012] fiscal year.

Mihiret said that some 21 years ago [1991], the electric power sector had only hundreds of millions of birr as annual budget which has currently reached hundreds of billions of birr. For the project that will be implemented in the next five years [2013-2018], all costs have been divided for each year and the draft budget is expected to be made official in the near future.

The required amount of the budget will mainly go to the construction of hydroelectric power plants, power transformation lines and for other electric power related infrastructures.