New targets for energy generation by 2030
On March 23rd, the Ethiopian Parliament approved the government’s 10-Year Development Plan (“DP”) which replaces the previous Growth and Transformation Plan (GTP) I & II (2010-2020). Envisioning to become a “pathway to prosperity”, the DP promises to capitalize on the economic successes of the past decade and address structural bottlenecks to further boost economic growth. With an overarching goal of building a “pragmatic market based economic system” and achieving “structural transformation of the economy”, it aims to increase participation of the private sector, address macro-economic imbalances, foster fast economic growth, enhance job creation and improve economic productivity and competitiveness.
The DP encompasses political, social and economic pillars that will guide the policy direction of the government for the next decade. These pillars are (a) ensuring sustainable economic growth and shared prosperity (b) increasing productivity and competitiveness (c) advancing technological capabilities to build a digital economy (d) ensuring sustainable development financing (e) creating a private sector led economic growth (vi) building a green economy able to withstand natural and manmade disasters (f) ensuring peaceful transition of political power (g) encouraging social and economic inclusivity (h) ensuring access to justice, quality public service delivery, sustainable peace and (i) strengthening regional economic integration.
Based on these strategic pillars, the DP identified priority areas of intervention, among which, infrastructure development is featured as a key priority. Within the infrastructure component, four sub-priorities are further identified – Innovation technology, Transport, Energy and Water irrigation. Acknowledging the role of energy in industrialization and overall economic development, the DP places high emphasis on expanding infrastructure to provide quality and reliable energy supply.
This brief note provides a summary of the targets set for the energy sector.
GTP’s Energy Targets
Under GTP I and II, significant progress was made in increasing access to energy from a total installed capacity of 2,048 MW in 2010 to 4,478 MW in 2020. Much of the installed capacity is attributed to hydro power accounting for 90%, and the remaining 8% and 2% to wind and solid waste respectively. Electricity outreach has reached 44%. While the gains are tremendous, the execution fell short of meeting the generation targets. (See table below.)
| Indicator | Baseline (2015) | GTP Target (2020) | Status (2021) |
| Increased Electricity Generation Capacity | 4,180MW | 17,208MW | 4,478MW (26%) |
| Expanded Electricity Transmission Lines | 16,018km | 21,728km | 18,400KM (84%) |
| Increased Electricity Customers | 2.31 Million | 6.955 Million | 5.8 Million (84%) |
| Reduced Energy Loss | 21% | 11% | 19.6% (56%) |
Among others, the DP identified the following factors that stalled the successful implementation of the GTP’s generation targets (a) high dependency on hydro power and inability to diversify energy sources (b) severe project implementation delays and corresponding losses in revenue (c) lack of private sector participation (d) weakness in leveraging new technologies and e) human resource limitations. This has resulted in large segments of the country’s population in the dark and severe load-shedding for those with grid connectivity.
The DP’s Energy Targets
The DP states that it was designed to align with Goal 7 of the UN Sustainable Development Goals (SDG7) which is to ensure “access to affordable, reliable, sustainable and modern energy for all.” Building on previous achievements of the GTP and placing greater focus on service delivery, the DP sets out the following key goals:
- Achieve equitable access to energy for all.
- Deploy clean and energy efficient technologies.
- Attract private financing for infrastructure expansion.
- Encourage private sector investment in the energy sector through Public Private Partnerships and targeted investment promotion.
- Provide quality and reliable electricity supply and improve service delivery.
- Enhance human and institutional capacity and reform the power sector.
The new targets for the 10-year period, notably less ambitious than the GTP, are as follows.
| Indicator | Baseline (2020) | Target (2030) |
| Increased Electricity Generation Capacity | 4,478 MW | 19,900 MW |
| Expanded Electricity Transmission Lines | 18,499 KMs | 29,900 KMs |
| Increased Energy Exports | 2,803 GWH | 7,184 GWH |
| Increased Electricity Customers | 5.8 Million | 24.3 Million |
| Increased Grid Connected Customers | 33% | 96% |
| Reduced Off-Grid Customers | 11% | 4% |
| Reduced Energy Loss | 19.6% | 12.5% |
The DP, at 213-pages, is an all-encompassing document incorporating economic, social and political objectives. It is generic in form and only provides a snapshot of the strategic pillars and priority areas for the government moving forward. More details of the targets and the strategies for implementation are expected to be included in sector ministry plans and policies, with supplementary legal and institutional reforms being rolled out. Highly expected among these are a new Energy Policy (Draft available here) and implementation of the Power Sector Reform Roadmap.
