Ethiopia

Ethiopia with its nearly 100 million inhabitants has enjoyed decades of strong development with annual economic growth rates at 10 pct. To sustain momentum and economic progress Ethiopia has ambitious development plans with clean energy being at the core. 

The Government of Ethiopia plans to invest massively in renewable energy such as wind, hydro, solar and geothermal energy to reduce absolute emissions by 2030 and partly to meet an increasing domestic demand and to maintain the role of net exporter of energy to neighbouring countries such as Sudan, Kenya and Djibouti.

Ambitious target for a flexible integrated energy system 

The vast majority of Ethiopia’s energy is generated from large hydropower plants, but the country has been struck by continuously more frequent droughts. This reduces the share of electricity that Ethiopia is able to generate from hydropower, making the energy system unreliable due to fluctuations in water supply. 

To manage the fluctuating water supply, Ethiopia wishes to introduce a more diverse energy mix. As a result, the Government of Ethiopia is planning to expand the wind capacity from the current 324 MW up to approximately 5,200 MW, an increase in outcome of more than 1,000 pct. within four years.
The objective is part of the ambitious Ethiopian commitment under the Paris Agreement of reducing carbon emissions with 64 pct. before 2030. Apart from accelerating the wind power generation, the objective also calls for upscaling grid flexibility to integrate diverse and fluctuating energy sources like wind power.  
 

The Danish Energy Agency contributes with expertise on tendering design

In order to accelerate the Ethiopian wind energy expansion, Denmark and Ethiopia cooperates in the Accelerated Wind Power Generation in Ethiopia (AWPGE) programme. The Danish Energy Agency, the Danish Foreign Ministry and the Danish transmission system operator, Energinet.dk will support Ethiopia to meet the ambitious targets for the energy sector.

Danish Energy Agency provides technical assistance based on Danish experience on large scale wind project tenders. The Danish tendering design has demonstrated the efficiency of the tendering method in reducing costs to erect and produce wind power. This experience will now be transferred to Ethiopia, where DEA will cooperate with Ethiopian authorities on designing a new tendering framework for large scale onshore wind projects. Additional to reducing carbon emissions, this also benefits Ethiopian consumers and maintains Ethiopia’s role as an attractive net exporter of energy to its neighbouring countries. 

DEA will also assist in building up technical capacity in the Ethiopian government. A Danish energy advisor is located in the Ethiopian Ministry of Water, Irrigation and Electricity to help with strategic issues and coordinate the programme implementation

Tendering system opens for international investments

More than EUR 6bn must be mobilized to effectuate the Ethiopian wind targets, bringing forth a need for investments from international investors, banks and developing financial institutions. Designing a new tendering system will assist in shaping procedures and framework conditions for a cost-effective expansion of wind power in Ethiopia, urging international players to invest in the Ethiopian wind expansion. 

Focus on the transmission system

Along with DEA, the Danish TSO Energinet.dk will cooperate with the Ethiopian TSO, Ethiopian Electric Power (EEP), to incorporate a large amount of wind power into the energy system. Ethiopia will benefit from Energinet.dk’s extensive knowledge from Denmark, where in 2015 more than 40 pct. of the power consumption was generated from wind power. Similar to the Nordic power system, Ethiopia has large hydropower resources which can be utilized to balance the Ethiopian power system in periods with low wind resources.

About AWPGE

  • Accelerated Wind Power Generation in Ethiopia (AWPGE)  supports the expansion of wind power in Ethiopia as an important supplement to the country’s larger hydropower reserves and strengthening the position of Ethiopia in the East African region as net exporter of renewables to neighbouring countries as Sudan and Kenya
  • AWPGE  mobilises the private sector in the Ethiopian energy supply and supporting the financing of the necessary expansion for continuous growth and development in the country and region
  • By means of Danish expertise and consolidated experiences on Government-to Government assistance, AWPGE will ensure a fast and cost-effective deployment of large scale wind power projects in Ethiopia benefitting Ethiopian power consumers and the Ethiopian economy.

The Danish-Ethiopian Cooperation

Henrik Breum
Special Advisor Centre for System Analysis, Energy Efficiency and Global Cooperation (+45) 3392 7812