World Bank approves $ 200 mm for Ethiopian power sector
The World Bank has approved a $ 200 mm equivalent credit for an energy development project in Ethiopia that will
improve the efficiency and sustainability of Ethiopia's power sector through institutional capacity building, rural
energy development, and the construction of a hydroelectric power plant along the Gilgel Gibe River.
The benefits of the Ethiopia Energy II Project include providing much-needed generating capacity for the power
system; relieving the financial burden on the treasury by charging adequate prices; reducing costs; and improving
quality of service. The project aims to connect an additional 250,000 new customers by 2002; reduce system failures;
improve the use of rural renewable energy; and make an inventory of woody biomass stock in Northern regions.
"At present, only about 5 % of the population has access to electricity and this electricity is being rationed, which
slows Ethiopia's economic recovery," said Task Team Leader Alfred Gulstone, Principal Power Engineerfor the World
Bank. "This project will help Ethiopia produce urgently needed energy, and open up electricity service for many more
users. "
The total cost of the $ 295.89 mm of the project will be financed by a $ 200 mm equivalent (SDR 146.1 mm) IDA credit.
It is co-financed by the government of Ethiopia in the amount of $ 48.93 mm, the European Investment Bank $ 42.11 mm,
and the Nordic Development Fund $ 4.85 mm.
