AFDB Approves US$104 Million Loan For Ethiopian Power Sector Project

The African Development Bank (AfDB) has approved a US$104 million loan for a project to sustainably extend power to industries in Ethiopia’s Tigray and Afar regional states.

A statement posted on the AfDB website says the Mekele-Dallol and Semera-Afdera Power Transmission Supply for Industrial Development and Access Scale-up Project is aimed at improving the socio-economic development and livelihoods in the states of Tigray and Afar through increased access to affordable and sustainable electricity supplies and improved service delivery.

According to the posting, the project is critical to ensure that electricity generated from power plants is transported to remotely located load centres. It will also solve the prevailing power shortages caused by inability of existing diesel power plants to satisfy rapidly growing demand in the local potash and salt industries.

The AfDB’s Director of Energy, Environment and Climate Change Department, Alex Rugambam is quoted as saying that domestic infrastructure development and regional integration, especially within the power sector, are fundamental to achieving the goals of the New Deal on Energy for Africa.

Extending the grid will help to create electricity access, replace diesel with cleaner and more affordable reliable power for industries as well as urban and rural towns around Dallol and Afdera to stimulate economic activities that enhance job creation, improve access to basic services and limit environmental degradation.

Upon its completion in 2019, the project is expected to benefit an estimated 36 rural villages through improved access to electricity and basic social services.

In the Afar region alone, it is expected to help scale-up access to electricity to 75 percent through its extension of reliable grid-based power supply to industries, local small business, schools, health and social centers.

The government of Ethiopia is contributing more than US$18 million to the total project cost of US$122 million. The government is working to increase its electrification rate to 90 per cent by 2020 to meet the growing industrial, commercial and domestic demand.




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