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AfDB loan for Ethiopia Kenya link

10 January 2013 – The African Development Bank (AfDB) has approved a loan agreement of US$115 million to finance the construction of a cross-border electricity transmission link between Ethiopia and Kenya. The US$1.26 billion Ethiopia-Kenya power line project is a 1,068 km high-voltage transmission line with a power transfer capacity of up to 2,000 MW.

Upon completion the project will promote power, economic trading and regional integration further contributing to the Eastern Africa Power Pool (EAPP) countries’ social and economic development. According to AfDB, the project will position Ethiopia as the main powerhouse and Kenya as the main hub for power trade in the East African region.

The project which is co-funded by the World Bank; the French Development Agency; and by the governments of Ethiopia and Kenya will ultimately connect power grids of five East African countries, namely Kenya, Rwanda, Uganda, Burundi and the Democratic Republic of Congo.

In September 2012 the AfDB approved a second phase of US$348 million to fund the project.

Ethiopia is investing billions of dollars in building hydropower dams as part of its ambitious plan to be a leading regional power exporter. Ethiopia currently exports electricity to Djibouti and Sudan. It will start exports to Kenya when the construction of power transmission inter-connector pipeline is complete.

According to Ethiopia Electric and Power Corporation (EEPCo), Ethiopia has plans to invest over US$12 billion to increase its power generating capacity to 10,000 MW in 2015 from the current 2,000 MW. It will further boost this to more than 40,000 MW of hydropower by 2035, which will then make the country Africa’s largest power exporter.