Executive Directors of the African Development Bank Group have approved a loan and a grant amounting to US$ 97.79m for the rehabilitation of power systems in Ethiopia.
The US$83.64m loan and US$14.15m grant from the African Development Fund (ADF), the concessional window of the AfDB Group will be used to finance the rehabilitation and upgrading of power transmission and distribution Systems in the capital, Addis Ababa.
The Bank financed the systems distribution master plan study in 2015. The Project, to be completed in three years, involves rehabilitation & construction of 545 km of medium voltage lines, replacement and installation of 582 distribution transformers, 14 primary substations and establishment of supervisory control and data acquisition system (SCADA) for operations and control. It also includes upgrading nine existing high voltage substations and construction of one 132 KV, 3.8 km double circuit km overhead line.
The project will support Ethiopia government's efforts to remove constraints on the electricity infrastructure; meet growing demand in the capital city and its environs; replace obsolete equipment to reduce energy losses and overloads, all which aim to improve the quality of electricity supply. It will also address the connection backlogs estimated at 432,000 due to inadequate distribution capacity.
The project is aligned with the Banks Ten Year strategy (2012-2022), the New Deal on Energy for Africa and the High 5 priorities, especially with regards to Power Industrialization and improve living standards. It is also in line with the current Bank's Country Strategy Paper (2016-2020) which focuses on infrastructure development.
The Bank's intervention is aligned with Ethiopia's long-term development blueprint GTP-II plan (2016-2020)which has energy infrastructure development as one of the main pillars.
Housing, commercial and industrial centers, the new light rail system and medium businesses are among the direct beneficiaries of the project.
International Cooperation Agency (JICA) is contributing US$ 90.65m while the Government of Ethiopia makes up for the remaining US$ 20.59m to complete the total funding of US$ 209.