State utility firm Ethiopian Electric Power (EEP) on Monday signed an agreement with two Chinese firms and one Kenyan firm for the 70 MW geothermal energy drilling project. The two Chinese firms were Shandong Kerui Oilfield Service Group and Shandong Kerui Oilfield Service Group Co. Ltd. Another firm Kenya Electricity Generating Company was also part of the agreement.
In a press statement, EEP said the two Chinese firms and one Kenyan firm are expected to supply drilling materials as well as drill wells for possible geothermal energy sources in central Ethiopia. Named the Aluto- Langano geothermal project, it's part of the Ethiopian government's plans to generate up to 5,000 MW of geothermal energy in the coming few years. Ethiopia currently produces only 7.3 MW of geothermal energy.
Energy experts advised the Ethiopian government to build its institutional capacity to tap into the huge geothermal energy resources. At a consultative workshop organised by the World Bank yesterday a team of geothermal experts stated that the country should set up the right institutions, regulatory body and human resource that can enable the country to tap into its enormous geothermal energy potential. The experts said that though Ethiopia has the potential to generate 10,000MW of electricity from its vast geothermal resources found in the east Africa rift system it has not yet reached development stage unlike its neighbor Kenya which is generating 650MW from geothermal resources. Though Ethiopia started exploring its geothermal potential in the 1970s the country’s geothermal sector is at its infant stage.
Minister of Water, Irrigation and Electricity, Sileshi Bekele (Eng.), said that in line with the Ethiopian government’s climate resilient green economy strategy, harnessing renewable energy resources is a priority for the country, adding that his Ministry supports the development, adoption and implementation of policies and regulations. Geothermal is a reliable source of energy and is environmentally friendly. “The Ministry promotes development and deployment of new and renewable energy technologies to address the growing energy demand and climate change concerns of the country,” Sileshi said. He pointed out that as geothermal resource is a reliable source of energy, environmentally sustainable and has high capacity factor his Ministry gives due to attention for the development of geothermal power projects.
Tullu Moye Geothermal Operations Private Limited Company has embarked on the development a 520 MW geothermal project in the Oromia Regional State with an outlay of two billion dollars. The Tulu Moye Geothermal project is located in the Oromia Regional State, East Arsi zone, near Eteya town. Tulu Moye Geothermal Operations plans to develop 520 MW of electricity in four phases. Reykjavik Geothermal (RG), an Icelandic company, and Meridiam, a US firm, are shareholders of Tullu Moye Geothermal Operations.
The power purchasing agreement (PPA) was signed by the Ethiopian Electric Power (EEP) and the Ministry of Finance and Economic Cooperation along with Corbetti Geothermal project on December 2017. The two geothermal projects, the first independent power producers in Ethiopia, would have an installed capacity of generating 1,000 MW. The total investment costs are estimated to be four billion dollars.
Today, the U.S. Trade and Development Agency awarded a grant to TM Geothermal Operations Private Limited Company (TMGO)* , an Ethiopia-based company, to coordinate a feasibility study supporting development of the first 50 megawatts of a planned 520-megawatt Tulu Moye Geothermal project in the Main Ethiopian Rift. The study will be conducted by U.S. firm, Delphos International, Ltd., which has expertise in supporting power sector development and financing from its work across 35 countries.
In December 2017, Ethiopian Electric Power signed implementation agreements and power purchase agreements allowing the private sector to develop the Corbetti and Tulu Moye geothermal projects. These historic agreements will support 1,000 megawatts of geothermal power generation and over $4 billion of private investment in Ethiopia.