Ethiopia, a country in the northeastern part of Africa, popularly known as the Horn of Africa, is among one of the fastest developing nations on the continent. In terms of population, the country is home to over 100 million people, which makes it the second most populous country in Africa that covers a total area of 1,100,000 km². In the year 2016, the rural population constituted 80.08% of the total population. The capital is Addis Ababa and major languages spoken are Oromo, Amharic and Somali. English and Arabic are taught as foreign languages.
The economy of Ethiopia is a mixed and transitionning economy with a large public sector. It is the fastest growing economy in the region. However, it is also one of the poorest, with a per capita income of USD 783. Ethiopia aims to reach lower-middle-income status by 2025, which includes aggressive power generation and connections targets.
Despite Ethiopia’s abundant natural resources and huge energy potential, the country is experiencing energy shortages as it struggles to meet the growing electricity demand, with an access to electricity of only 45% in 2017.
Ethiopia’s power generation mix consists almost entirely of renewable energy sources. In 2018, the bulk of Ethiopia’s 4.5 GW of power generating capacity came from 14 hydropower plants, which accounts for 85% of the country’s total capacity, making it the main energy source. Other than hydropower, the country also has three wind farms, collectively generating 324 MW, and a few diesel plants, generating 143 MW, with the rest being generated by solar power , geothermal power (7.5 MW) and other renewables.
The hydro dominated systems have been severely affected by drought, and the Government of Ethiopia (GOE) is now diversifying the generation mix with other sources such as solar, wind and geothermal that will result in a more climate-resilient power system.
Ethiopia receives a solar irradiation of 5000 – 7000 Wh/m² according to region and season and thus has great potential for the use of solar energy. The average solar radiation is more or less uniform, around 5.2 kWh/m2/day. Next, to the PV and Solar Home Systems, there is also a market for solar water heating (SWH) systems that is growing steadily in Addis Ababa in the recent years.
The Ethiopian government’s Growth and Transformation Plan (GTP) II outlines very ambitious targets, such as increasing the energy generation capacity from 4.5 GW in 2017 to 17.3 GW by 2020, and getting the country’s electrification rate to 100% by 2025. The most significant foreign energy partner in Ethiopia is the Power Africa initiative. It was launched by the United States Agency for International Development (USAID) in 2013 with the goal of establishing 30,000 MW of energy generation capacity across Africa. Another significant international initiative is the Eastern Africa Power Pool (EAPP) which is based in Ethiopia. The EAPP facilitates cross border grid connections and mandates the establishment of common codes and standards. Ethiopia is also part of the World Bank Group’s ‘Scaling Solar’ program, which aims to further develop renewable energy sources, especially solar energy.