Ethiopia, Djibouti to launch second electricity link

Ethiopia, Djibouti to launch second electricity link

Djibouti and Ethiopia have announced plans to build a second electricity transmission following positive returns from the first project that linked their power grids.

The first project enabled Djibouti to import Ethiopia’s hydropower-processed, renewable and cheap electricity. According to Mr. Batchi Baldeh, the AfDB’s Director of Power Systems Development, the 283-km transmission line is reaching its power transfer capacity limit due to several developments in both countries, such as the industrial development in the eastern part of Ethiopia, the railway line from Djibouti to Ethiopia, which is powered by electricity, and the port expansion in Djibouti.

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Ethiopia-Djibouti Second Power Interconnection project

This second project which is set to boost trade, has received two grant loans worth US $83.6M grant from African Development Bank (AfDB). The funds comprise a US $69.65M grant to Ethiopia and a second grant of US $13.93M to Djibouti. The loans were sourced from the African Development Fund, the Bank’s concessional financing window and were granted based on a long-term loan framework. The grants also intend to deepen economic integration in the Horn of Africa’s region.

The Ethiopia-Djibouti Second Power Interconnection project, will entail the construction of nearly 300 km of interconnector line, 170 km of transmission lines, and new construction or renovation of substations in the two countries.

Upon completion, the project in question is expected to increase Ethiopia’s power export revenue and at the same time boost Djibouti’s access to reliable and affordable clean electricity, lowering costs to below US$ 0.10 per kWh.