Ethiopia has abundant energy resources including hydropower, geothermal, wind and solar energy. It has recently started exporting electric power to Djibouti and plans to expand its exports into other neighbouring countries including Sudan, Kenya and Egypt.
Energy Sector in Ethiopia
Ethiopia has abundant energy resources including hydropower, geothermal, wind and solar energy. It has
recently started exporting electric power to Djibouti and plans to expand its exports into other neighbouring
countries including Sudan, Kenya and Egypt.
Ethiopia has the potential to generate 45,000 MW of hydropower, 5,000 MW of geothermal
power and 1,000 MW of wind power. So far it has exploited only 2,000 MW of the estimated
potential. Out of total electricity production, 98% is generated from hydropower while only
7MW is generated from Geothermal power.
Located in the tropics, Ethiopia receives high solar energy with an average potential of 5.6
kilowatt per square meter.
Oil & Gas:
The sedimentary regions of Ethiopia cover a significant portion of the country and comprise six
distinct sedimentary basins, namely the Ogaden, Blue Nile, Mekele, Gambella, Metema and
Afar-Rift basins. Generally about 40% of the country is covered by sedimentary rocks of Permo-
Triassic continental to deep marine sediments and Cretaceous rift sediments and these are
prospective for petroleum resources.
The resource potential of petroleum and other types of energy appears to be highly promising.
Currently, there are 9 companies with 16 licenses engaged in oil and gas exploration in Ethiopia.
The Calub and Hilala gas-condensate fields with respective reserves of 2.7 Tcf and 1.3 Tcf are
under development for production with an outlay of USD 4billion private investment.
Annual oil and gas imports stands at USD 1.8 billion in 2010. The size of the domestic market
for lubricants is estimated at 48m litters per annum
In the next 5 year (2010/11 ? 2014/15) Growth and Transformation Plan (GTP), the government
plans to implement the following with an outlay of ETB 100 billion:
? Increase the current power generation capacity from 2000 MW to 10,000 MW;
? Construct 132,000 km new distribution lines;
? Rehabilitate 7680 km of old distribution lines;
? Increase the number of consumers with access to electricity from 2m to 4m; and
? The total underground power distribution system from 97 km to 150 km.
Potential business opportunities for UK companies includes feasibility studies, supply of
equipment and specialist consultancy especially in the areas of geology, tunnelling, finance and
carbon finance, and social and environmental impact assessment for the construction of new
hydropower plants, geothermal and wind power generation and building independent power
Oil & Gas:
Upstream: The number of blocks currently open to prospective private investors for oil and gas
exploration include the following:
? Ogaden Basin ? 6 blocks
? Nile Basin ? 6 blocks
? Afar-Rift Basin ? 2 blocks
Downstream: Lubricant import and distribution as well as fuel distribution businesses are open
for foreign investment.
Latest export opportunities ? Energy
Latest export opportunities ? Ethiopia
Getting into the market
The Ethiopian government gives priority to companies coming with their own finance and in this
case use direct negotiation to award projects.
Public procurement is the main method used by the government to hire contractors when the
project is financed by donors grant money, loan from multilateral agencies and the government?s
own source of fund.
Oil & Gas
Upstream: If more than one company are bidding for the same area to get oil and gas exploration
concession, concessions are awarded to those that have come up with the best financial and
technical proposals. On the other hand, direct negotiation will be applied if only a single
company applies to get concession of any particular area.
Downstream: investors who wish to engage in lubricants import and distribution as well as fuel
distribution business are required to have an investment permit from Ethiopian Investment
Agency (EIA) and business license from the Ministry of Trade.
More about doing business in Ethiopia
Market intelligence is critical when doing business overseas, and UKTI can provide bespoke
market research and support during overseas visits though our chargeable Overseas Market
Introduction Service (OMIS).
To commission research or for general advice about the market, get in touch with our specialists
in country - or contact your local international trade team.
? Dessalegn Yigzaw, British Embassy Addis Ababa. Tel: 251 -11 661 2354 or email:
? Hiriti Tesfalidet, British Embassy Addis Ababa. Tel: 251 -11 661 2354 or email:
Contact your local international trade team
UKTI runs a range of events for exporters, including seminars in the UK, trade missions to
overseas markets and support for attendance at overseas trade shows.
Latest events ? Energy
Industrialisation for Development and Transformation
Date: 23 ? 29 February 2012
Website address: www.addischamber.com
More about OMIS and other UKTI services for exporters