After seeing the benefits of the first project that connected their power grids, Djibouti and Ethiopia have acquired funding to establish a second electricity transmission line.
Djibouti was able to acquire Ethiopian hydropower-processed, renewable, and affordable electricity through the first project.
The African Development Bank (AfDB) has granted two grant loans totaling $83.6 million, allowing Ethiopia and Djibouti to move forward with the construction of their second power transmission line, which would eventually improve their energy trade.
According to a statement released by the bank last week, the funds were approved by the African Development Bank Group’s Board of Directors in order to promote cross-border electricity commerce between Ethiopia and Djibouti.
The grants will also help to strengthen economic integration in the Horn of Africa.
The funds come from the African Development Fund, the African Development Bank’s concessional financing window, and include a $69.65 million grant to Ethiopia and a $13.93 million award to Djibouti.
According to reports, the latest funds will be utilized for the second Ethio-Djibouti power transmission line project, which will be given on a long-term loan framework.
According to the bank, the Ethiopia-Djibouti Second Power Interconnection project will require the construction of almost 300 kilometers of interconnector line, 170 kilometers of transmission lines, and new or renovated substations.
“The first interconnection 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 (powered by electricity), and the port expansion in Djibouti “said Batchi Baldeh, the Bank’s Director of Power Systems Development.
“The two countries have thus decided to develop the second power interconnection line to maintain energy security and reliability for Djibouti” Mr Baldeh added.