ADDIS ABEBA – The World Bank’s Board of Executive Directors approved $200 million to support Ethiopia’s ongoing power sector reforms and leverage private sector financing for renewable energy generation.
Ethiopia has vast and largely unharnessed clean energy resources, but faces constant power deficit forcing authorities to ration electricity.
The world bank said a few countries in the world are generating almost all the electricity from renewable resources, mostly hydropower, like Ethiopia.
This makes the country vulnerable to climate change, it said.
Ethiopia’s World Bank-funded Renewable Energy Guarantees Program (REGREP) supports diversification from hydropower and towards modern renewables – in solar and wind power.
It said the program will support the development of over 1,000 MW of greenfield solar and wind energy Independent Power Producer (IPP) projects in Ethiopia, including the World Bank Group Scaling Solar initiative.
“REGREP comes at this critical juncture and signals the Government’s commitment to comprehensive power sector reforms and a private sector-led renewable energy development program that has the potential to be one of the largest in Sub-Saharan Africa,” said Rahul Kitchlu, Senior Energy Specialist at the World Bank.
The Ethiopia REGREP approved on May 23, 2019, marks the first International Development Association (IDA) guarantees under deployment in Ethiopia.
Enabled by the 2018 Public-Private Partnership Proclamation, this program reflects a new way of doing business in the energy sector in the country – transitioning from continued public-financing towards private sector-led competitively tendered procurement of new renewable generation capacity, according to the Bank.
The program is aligned with the World Bank’s Country Partnership framework for FY18—FY22.