On the 2nd of August, 2017, the Ethiopian government announced that it has taken an initiative to maximize the country’s Solar potential by signing an Energy Compact with the UK’s Energy Africa campaign to achieve its ambitious energy access targets.
This initiative elevates the hope that the modern energy access challenges in the country will be depleted.
The compact will enable the country to develop partnerships with the private sector, build delivery capacity within the Government, and support businesses that wish to work in and support the acceleration of the off-grid solar market in Ethiopia by creating business opportunities, more jobs and helping improve access to electricity.
To enhance the economy, there is need to foster an environment in which companies can enter energy generation, transmission and distribution markets, climb the value chain, and build the investment partnerships that can drive growth and create jobs.
Ethiopia is one of the least developed countries in the world with the population size of over 100 million people. Despite revelation that the country’s GDP has recorded an impressive growth in recent years which ranges between 6% and 12% per year, approximately 34% of her population lives below poverty line.
Ethiopia’s ability to achieve Sustainable Developmental Goals (SDGs) has been significantly constrained by challenges in the power sector such as low rate to access modern energy services. Energy supply is said to be primarily based on biomass. The sources of the country’s energy are 94% waste and biomass, 5.7% oil and 1.6% hydropower hyper. The demand for energy is expected to rise by a rate of 10% to 14% per year till 2037.
As a country that prides itself as the powerhouse of Africa with the plan to export power to Sudan, Kenya, Djibouti and even Yemen or Egypt, it is smart that the government seeks to invest in renewable energy resources and hydropower which are key donors to its economic growth.
The epileptic state of energy in a country can stunt the growth of domestic companies and discourage international investment and foreign firms from setting up manufacturing plants in the country, hence the need to invest in other renewable technologies to help diversify energy sources.
The hydropower potential in Ethiopia is important as it can make contribution to neighboring countries such as Kenya, Djibouti, Somalia and Eritrea as they constitute a readily available market for hydro-electric power within the region.
The government has taken initiatives to meet skyrocketing demand for energy in the country. An example is the 5-year Growth and Transformation Plan (GTP) launched in 2010 to increase the total generating capacity, as well as the development of the renewable energy sector in the country. Also, there are institutional setups, agencies and departments working towards ensuring that the energy potential in the country is harnessed to its full potential. With consistency in its effort to support innovative ways of supplying clean energy, Ethiopia can significantly forge ahead in years to come.