Ethiopia:

Ethiopia Agrees on First Deal for Privately Produced Geothermal Electricity (Bloomberg)

First 20 MW at Corbetti will cost $100 million to develop

Photographer Saul Loeb/AFP via Getty Images

Ethiopia’s government signed a deal to buy electricity from Corbetti geothermal-power plant being developed by companies including Reykjavik Geothermal Ltd. of Iceland, a partner in the project.

The state agreed to purchase power at 7.53 U.S. cents per kilowatt hour in an accord signed on Monday during President Barack Obama’s visit to the Horn of Africa nation,

Developing the first 20 megawatts of power output at Corbetti will cost $100 million, all of which will come from Reykjavik, Icelandic Drilling Co. and the African Renewable Energy Fund managed by Berkeley, said Edward Njoroge, chairman of the Corbetti Geothermal Power project. A total of $2 billion is required for generation of the full 500 megawatts, which is expected to be completed by about 2023, he said.

The tariff agreed with the government is “actually tight for us, but we think we can do it,” Njoroge said. The cost of electricity from geothermal projects in Kenya, Africa’s biggest producer of power from steam, is about 8.5 U.S. cents to 9 U.S. cents per kilowatt hour, he said.

U.S. advisers supported negotiations on the tariff via the Power Africa program, which seeks to boost access to electricity on the continent.

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