Africa Bank provides Ethiopia $200m in loans and grants to boost energy sector
By Tesfa-Alem Tekle
December 21, 2010 (ADDIS ABABA) – The African Development Bank (AfDB) has provided Ethiopia a loan and grant amounting $200 million USD to support the horn nation’s projects to develop electricity projects, according to the official Ethiopian Radio and Television Agency (ERTA).
The supplementary financing agreement was signed on Monday between Finance and Economic Development Minister, Sufian Ahmed and AfDB resident Representative of Ethiopian Office, Lamin Barrow.
According to the agreement around $ 130 million of the money is a loan while the balance is a grant.
The African Development Bank (AfDB) has been supporting the energy sector in Ethiopia by financing high voltage transmission lines, rural electrification and regional interconnection projects.
The funds will be used in projects intended to provide sustainable power for northern, eastern and southern parts of the country, which will allow the transmission of reliable power from the interconnected system. It will also facilitate the implementation of a rural electrification program, reduce high transmission losses, and improve system efficiency, stability and reliability.
Signing the accord, the AfDB representative the finance would also help strengthen regional interconnection between Djibouti, Sudan, Kenya and finally with other parts of east Africa.
It is hoped the support enable will Ethiopia to further exploit its hydro-electric potential, increase its foreign currency earnings for sustained economic growth and reduce poverty.
The support would also facilitate the implementation of Universal Electrification Access program, reduce high transmission loss, and improve system efficiency, sustainability and reliability.
According to an AFDB environmental and social impact assessment summery, the current Ethiopia Electricity Transmission System Improvement project consists of: construction, on a turnkey basis of four 230 kV transmission lines; construction of 12 associated substations; upgrading of four major substations in Addis Ababa; and Consultancy Services to draw up a power distribution master plan in the capital, Addis Ababa.
(ST)