Ethiopia’s quest to become a regional net exporter of electricity has received a major boost following the signing of a financing and construction agreement for a high-voltage transmission line to evacuate electricity from the Renaissance hydroelectric plant.

State-owned Ethiopian Electric Power Corporation (EEPCo) has awarded the contract for the project, which has a $1.2- billion price tag, to China Electric Power Equipment & Technology Company, which will be responsible for raising 85% of the total cost, while the Ethiopian government will provide the balance.

The project is part of Ethiopia’s plans to invest a total of $3.5-billion in transmis- sion and distribution infrastructure to facilitate evacuation of electricity from the numerous hydro, wind and solar plants being constructed as the country pushes to become a major powerhouse in the region.

Currently, Ethiopia has 11 124 km of high-voltage transmission lines but needs transmission and distribution lines totalling 258 000 km within the next four years to cater for the new generation plants and to facilitate exports.

“This project will have a significant role in linking the region . . . as it will supply power not only to the Ethiopian national grid but also to the two corridors that connect South Sudan and Sudan,” says EEPCo CEO Mihret Debebe.

The signing of the agreement paves the way for the construction of the 500 kV Grand Ethiopian Renaissance Dam– Dedesa–Holeto transmission line, which will facilitate power evacuation from the controversial mega dam.

Construction of the line will coincide with the ongoing construction of the $4.8- billion hydropower dam on the Nile river. The two projects are scheduled for completion in 2015.

The transmission line is one of the biggest extra-high-voltaic transmission lines in Africa. It will also involve the construction of two substations at Dedesa and Holeta and will connect to the national grid through the 400 kV transmission lines that stretch from Holeta to three existing substations.

“We understand the importance attached to this project and we would strive to carry out the project as per the timeframe set by the government of Ethiopia,” says China Electric deputy president Du Zhigang.

Securing funds for the project has been a major relief for Ethiopia, considering the challenges being experienced in sourcing funds for the Renaissance dam, which is also known as Grand Millennium dam.

The project, which will be the largest hydropower plant in Africa, with capacity to generate 5 250 MW, is being constructed by Italian company Salini Costruttori but has been given a wide berth by global financial institutions.

The authorities in the Horn of Africa nations have been forced to turn to desperate measures, including musical concerts, a lottery, an SMS campaign, soliciting donations and the selling of government bonds, besides others, to raise funds for the dam.

At the end of last year, about 14% of the construction work had been completed and it is expected the project will be 26% complete at the end of this year.

Ethiopia has a population of 80-million people, of whom only about 20% have access to electricity. Demand for electricity is growing at a rate of 10% a year.

The country, with potential to generate 35 000 MW of hydropower, projects that power exports could rake in $407-million a year. Already power purchase agree- ments have been signed with neighbouring countries Kenya, Djibouti, Sudan and South Sudan.