Ethiopia Handles Neighbors' Water Concerns, Launches Another 2,050 Megawatts of Hydropower

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Written by Richard Finlayson, Senior International Editor for Industrial Info Resources (Sugar Land, Texas)--Ethiopia appears to be nearing an agreement with Egypt and Sudan on water and power use from the $5 billion, 6,000-megawatt (MW) Grand Ethiopian Renaissance Dam project on the Blue Nile. But the planned series of Gibe power projects is catching some negative reaction from Kenyan communities along the shore of Lake Turkana.

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Ethiopia has announced plans for the Gilgel Gibe IV and V hydropower dams to be constructed along the southern Omo River, along the border with Kenya.

The two new dams will be part of Ethiopia's large schedule of projects in its next five-year national plan. They will have total power-generating capacity of 2,050 MW, with 1,450 MW from Plant IV and 600 MW from Plant V. It was reported that the plants will be funded by bonds, with sales managed by BNP Paribas (OTC:BNPQY) (Paris, France), Deutsche Bank AG (NYSE:DB) (Frankfurt, Germany) and JPMorgan Chase & Company (NYSE:JPM) (New York).

According to a water ministry spokesman, Ethiopia has an estimated 45,000 MW of hydropower potential.

More projects are under consideration, including some along the Nile, which could rekindle tension with Egypt. The Ethiopian government counters these worries by saying that water and power usage can be managed for mutual benefit.

For related information, see April 25, 2014, article - Ethiopia's Gibe III Hydro Project Slips Schedule.

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