29 January 2013

East Africa: Ethiopia Plans to Power East Africa With Hydro

Addis Ababa — Ethiopia is gearing up to export large amounts of clean power across East Africa in the coming years, starting with neighbouring countries Djibouti and Sudan. But the ambitious plans have ignited controversy on several fronts.

Ethiopia wants to increase its electricity exports - mainly generated from hydropower - as a reliable source of precious hard currency. It is estimated to possess a potential capacity of 45,000 MW from hydro alone, which could place it at the centre of an emerging electricity network across the region, driven largely by renewable energy.

The Eastern Africa Power Pool aims to connect the power grids of at least nine countries, including Ethiopia, Kenya, Rwanda, Uganda, Burundi, Tanzania, Democratic Republic of Congo, Sudan and Djibouti. It may also be extended to northern and southern Africa.

State-owned Ethiopian Electric Power Corporation (EEPCo) last year announced a revised 25-year power-sector strategy, aiming to boost generating capacity to 37,000 MW annually by 2037. A substantial amount is intended to be surplus power and is slated for export.

Work is already underway to achieve this goal. The 283-km Ethiopia-Djibouti transmission line was officially inaugurated in October 2011. The 230-kV line, enabling Djibouti to import up to 60 MW of electricity, is estimated to be earning Ethiopia at least $1.5 million per month, and has eased Djibouti's reliance on fossil-fuel power plants and generators.

The African Development Bank (AfDB) provided $95 million for the project linking the two countries. Its launch was significant for Ethiopia, as tiny Djibouti has a port that serves as the gateway for around 98 percent of landlocked Ethiopia's export-import trade, creating economic and security interdependence.

Electricity is costly in Djibouti compared with the rest of East Africa and even Arab League member states, making its capital, Djibouti City, one of the most expensive cities in the Arab world.

Producing power with fuel-operated generators costs about $0.25 per kilowatt hour compared with around $0.07 per kilowatt hour for the power Ethiopia is exporting to Djibouti, according to EEPCo.

But the project caused some controversy when it was launched. At the time, major cities in Ethiopia, including Addis Ababa, faced sporadic power cuts, sparking grumbles by some Ethiopians that the scheme came at the expense of their own domestic power supply.

Multilateral donors were also initially hesitant about the feasibility of power export schemes due to concerns over inadequate infrastructure and political instability in the region.

SUDAN CONNECTION 'OVERDUE'

Nonetheless, wider plans are gathering speed, with the 296-km, 230-kV Ethiopia-Sudan transmission line now being tested. Ethiopia expects to sell up to 100 MW of electricity to Sudan, according to EEPCo spokesman Miskir Negash.

The power exports will be managed so as not to jeopardise Ethiopia's domestic power supply, and the price for the electricity will be announced soon by the Ethiopian government after it finalises negotiations with Sudan, Negash added.

The $41million project, funded by the World Bank, started in 2008 and has three sections of transmission lines in Ethiopia which will connect with a line in the Sudanese border city of Gedaref.

Abdelrahman Sirelkhatim, Sudan's ambassador to Ethiopia, said the project is long overdue, and will help foster economic ties between the two countries.

But it has experienced difficulties getting off the ground, running more than two years over deadline, primarily because of financial sanctions on foreign payments imposed by the United States on Iranian banks.

This meant that the substation contractor, an Iranian firm called SUNIR International, had trouble obtaining credit and financing the project in US dollars. As a result, the Ethiopian government had to stump up an extra $3 million to expedite the work, money the Iranian company has agreed to refund later, Negash said.

KENYAN CRITICS

All eyes are now on a proposed Ethiopia-Kenya electric transmission line, which could bring Ethiopia closer to the East African community.

Historically, Ethiopia has had fewer trade ties with Kenya than with other East African nations, including war-torn Somalia, due to a combination of infrastructure problems and trade and tariff restrictions imposed by Addis Ababa.

The 500-kv transmission line connecting the Kenyan and Ethiopian grids is expected to be completed by the end of 2016 at a cost of up to $1.26 billion. It would make Kenya, which has the region's largest industrial base, the largest buyer of Ethiopian power at an eventual 400 MW, and could allow Ethiopia to export up to 1,600 MW to countries further afield.

This project too has its critics, mainly on the Kenyan side. They say Kenyan leaders are brushing aside concerns about the controversial 1,870 MW Gibe III dam being built in southern Ethiopia, because of Nairobi's desire to purchase power from Ethiopia to reduce power cuts and drive down electricity prices.

Kenyan and international NGOs, including Survival International, have warned that the project will displace tribal people in southern Ethiopia and northern Kenya, and could pose a serious threat to Lake Turkana, the world's largest desert lake, in northeast Kenya.

According to Chinese news agency Xinhua, Prime Minister Raila Odinga said last year any problems caused by the dam would be temporary. The two governments have also set up a joint council to deal with matters arising from the use of the Omo River waters.

In June 2012, EEPCo brokered its fourth power export agreement with the newly independent country of South Sudan, to be undertaken in two phases. South Sudan, which has rich oil reserves, has depended on fossil fuels for its power supply.

CLIMATE UNCERTAINTIES

One key risk for Ethiopia's power export strategy is climate change, which is likely to affect the flow of water in the rivers and dams driving hydro-power production. But there is still a high level of uncertainty over how this will play out.

Wondewossen Sintayehu, an official at Ethiopia's Environmental Protection Authority (EPA), said more research is needed to establish the impacts of climate shifts and changes in precipitation on electricity generation. Smaller rivers are likely to be more vulnerable to any reduction in water levels or increase in pollution, whereas most hydro-power projects are being constructed on larger rivers such as the Nile and the Omo, he added.

So far, data has shown that climate change is leading to higher rainfall in general, which could be a positive factor for hydro-power production, he noted. But Ethiopia has more than 30 agro-ecological zones, and detailed studies are being carried out to analyse the effects of climate change on specific regions and the rivers that originate in them, Sintayehu said.

Sileshi Bekele, a senior water and climate specialist at the United Nations Economic Commission for Africa (UNECA), said climate extremes could have negative consequences for hydro-power projects.

A sustained drought period lasting for several years could lead to declines in production, while dams built without due attention to climate data could see their reservoirs and spillways unable to cope with water levels in times of flooding, he noted.

But he also emphasised the environmental benefits of hydropower schemes. They contribute to climate change mitigation, as they have negligible carbon emissions, and they can also help regenerate ecosystems, he said.

E.G. Woldegebriel is a journalist based in Addis Ababa with an interest in environmental issues.

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