Ethiopia Energy Outlook

Africa Energy Outlook 2019 is the IEA’s most comprehensive and detailed work to date on energy across the African continent, with a particular emphasis on sub-Saharan Africa. It includes detailed energy profiles of 11 countries that represent three-quarters of the region’s gross domestic product and energy demand.

Ethiopia could supply a much larger economy than today in the AC, using only twice the energy, were it to diversify its energy mix and implement efficiency standards.

In the AC, this diversification comes about as a result of a substantial expansion of geothermal energy along with increased use of oil within industry and for cooking.

Ethiopia is currently heavily reliant on hydropower; plans to increase capacity to 13.5 GW by 2040 would make Ethiopia the second-largest hydro producer in Africa.

Providing electricity access to all and electrifying productive uses will lead to a fivefold increase in generation in the STEPS, and an even bigger increase in the AC; solar PV and geothermal account for almost 45% of the power mix by 2040 in the AC.

Increased affluence in the STEPS results in a more than fourfold increase of the private vehicle stock with the number of cars reaching 700 000 by 2040. This results in a 300% increase in related oil consumption.

To meet the needs of its growing population, Ethiopia remains a large producer of cement causing energy demand to increase significantly in both scenarios.

Ethiopia currently has an electricity access rate of 45%, 11% of its population already have access through decentralised solutions. Strong government commitment to reach full access before 2030 in the STEPS.

In both scenarios, around 80% of new connections are cost effectively delivered by grid densification and extension as a large part of the population lives close to the grid.

In the STEPS, a push on improved and advanced biomass cookstoves alongside more access through LPG and electricity increases the population with access by 40 million by 2030, with 60% of this increase taking place in rural areas.

In the AC, increased efforts using the same solutions bring access to clean cooking by 2030 to the remaining 95 million people that rely on the traditional use of biomass.

Growing fossil fuel consumption is met almost entirely by imports in both scenarios.

A high degree of dependency on imported fuels in both scenarios and a range of infrastructure development challenges underline the case for the development of hydropower and other renewables. 

Cumulative energy investment of $100 billion is needed in the STEPS, with electricity access and networks taking the majority.

The AC needs around 80% more capital, including a doubling of investments in renewables and electricity networks compared with the STEPS.