Middle East & Africa, Renewables

Icelandic company to invest $4bn in Ethiopian energy

Reykjavik Geothermal expects to spend around $4bn in developing geothermal power in Ethiopia over the next decade.

The Icelandic company has agreed to develop as much as 1,000 MW of projects in the African nation according to Chairman Michael Philipp.

About 10 MW will be in operation by 2015, with a total of 500 MW by 2018. A second phase may include as much as 500 additional MW of capacity. Ethiopian Electric Power Corp. has agreed to buy all the electricity under a 25-year contract.

Geothermal

“This is the kind of commitment you need to get the financial backing to finalize the development phase,” Philipp said. About one-fourth to one-third of the project will be financed with equity.

The Great Rift Valley in East Africa, which spans eight countries, may have as much as 20 gw of potential geothermal energy, according to data compiled by Bloomberg.

The project planned in Ethiopia’s Corbetti Caldera region will be Africa’s largest geothermal power plant.

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