Ethiopia has significant oil and gas reserves and has not yet exhausted its economic hydro power potential.
Ethiopia has approximately 529 MW of installed generating capacity. The vast majority of Ethiopia's existing capacity (85%) is hydroelectric. The Ethiopian Electric Power Corporation (EEPCO), the state-owned firm responsible for electricity generation, plans to construct several new generating facilities to provide electricity to Ethiopia. Currently, less than half of Ethiopia's towns have access to electricity though EEPCO electrified more than eighty towns between 2001 and 2003. Since most of Ethiopia's electricity is generated from hydroelectric dams, the country's power system is vulnerable to extended droughts. Ethiopia recently endured more than six months of power cuts due to low water levels in dams around the country. Initially blackouts were scheduled once a week, but as the drought wore on, customers lost power for 15 hours two days a week, a situation that strained the resources of many businesses in urban centers.
EEPCO is rapidly expanding their generating capacity. The 73-MW Tis Abay 2 facility, located on the Blue Nile (Abay) came online in 2001. U.S.-based Harza Engineering (now MWH Global) is overseeing the construction of an additional 34-MW unit at the Finchaa hydroelectric facility in western Ethiopia. EEPCO had planned to open the new 180-MW Gilgel Gibe hydroelectric facility in October 2003, but only 30 percent of the project has been completed thus far. Gilgel Gibe, located on the Omo River in southwestern Ethiopia, will increase the country's power capacity to 700-MW. EEPCO has begun development of Ethiopia's largest generating facility at Tekeze. The 300-MW hydroelectric facility is located in northern Ethiopia. The project had a cost of about $350 million.
In recent months EEPCO has extended its services to 47 towns through its national power supply program. The corporation has initiated and implemented significant activities in power generation, distribution and transmission costing over 3 billion birr (346 million U.S. dollars).
So far only 13 percent of Ethiopia’s population has access to electricity but that is expected to rise to 20 percent by 2012.
