Ethiopia Launches 6,000-Megawatt Hydropower 'Project X'

Written by Industrial Info Resources

Researched by Industrial Info Resources (Sugar Land, Texas) Ethiopia's ambitious intentions to exploit the country's hydropower potential and make it east Africa's leader in renewable power for the next five years have taken a major step forward. The Ethiopian Electric Power Corporation (EEPCo) (Addis Ababa, Ethiopia) is moving on the construction of a 6,000-MW hydropower scheme, which has been dubbed "Project X" in government circles. Project X will be the foundation of a three-dam project to be launched in 2011 and is part of a plan to build generation capacity to 10,000 MW. Salini Costrutori (Rome, Italy) is reported to have been awarded the hydro installation construction contract for the project. The company already has been active in Ethiopia with the construction of the 420-MW Gilgel 11 and 460-MW Tana Belesa hydropower projects. These two plants provide 47% of the country's present power generation capacity. Salini has a global annual turnover of $1.6 billion and planned works totaling $11.1 billion. Salini already has moved heavy construction machinery to the site and is building personnel camps and site service installations. The site for the project is on the Abay River, which is 40 kilometers from the Sudanese border, in Benishangulk state. EEPCo's project managers on the previous two projects will fulfill the same function of managing the civil and electro-mechanical engineering works on Project X, which could be renamed the "Millennium Project." They will establish a project office for project contracts. Contracts for the electro-mechanical section could be given to a Chinese company, which would open the door for the Ethiopian government to raise funds from the Chinese government for the project. The hydro plant is currently scheduled for completion in 2016. EEPCo is trying to raise its power generation capacity to 8,000 MW when all three of the new projects are commissioned. The company plans a 255% increase in generation capacity; a 155% increase in transmission capacity to an 8,495-kilometer grid; and an increase in total transmission and distribution lines, from 25,000 kilometers to 126,038 kilometers. This will enable it to give power access to 5,163 towns and villages and increase the number of customers from 953,007 to 1.9 million. If the current expansion plans for hydro and wind projects are completed, it will allow EEPCo to keep pace with the growth in local demand and industrial expansion, and to export surplus power to the region. Industrial Info Resources (IIR) is the leading provider of global market intelligence specializing in the industrial process, heavy manufacturing and energy markets. IIR's quality-assurance philosophy, the Living Forward Reporting Principle™, provides up-to-the-minute intelligence on what's happening now, while constantly keeping track of future opportunities.

Ethiopians Prefer Driving Home-grown Cars

MONDAY, 06 SEPTEMBER 2010 09:22 NEWBUSINESSETHIOPIA.COM

By Luc van Kemenade NEW BUSINESS ETHIOPIA CONTRIBUTOR
With public purchasing power on the rise, Ethiopia’s small but emerging middle class yearns to cruise around Addis Ababa in style. They refuse to pay sky-high import taxes for second hand cars. Instead, they prefer driving around in home-grown vehicles.

A model by Lifan motors, Former Partner of Holland car plc now its market competitor

The supply of new models assembled in Ethiopia increases and this is reflected in the streets of the capital city. More often the “Ethiopian” cars appear among the chaotic traffic that is still dominated by rundown Lada cabs and Toyota Corollas.

It costs a small fortune to get a second hand vehicle from the West through the port of Djibouti into landlocked Ethiopia. Although taxes have been reduced, they can still rise up to over 100 percent of the purchase value plus the transportation costs, i.e. unaffordable to many. For a twenty years old Toyota Corolla, for example, you pay 12,500 euro.

The solution is simple: import spare parts, from China for example, and assemble them in a factory with relatively cheap labour. Although a simple strategy, it’s quite unique on the African continent. Various investors in Ethiopia saw the opportunity and grabbed it, Holland Car, a Dutch-funded company, being the first.

A model by the Pioneering car assembly in Ethiopia- Holland car plc

Sishah Yohannes, a forty-year-old captain at Ethiopian Airlines, drives his Ethiopian-assembled Holland Car Awash for a month now. “I’m really proud when I see the name written in Amharic on the back,” he says while parking at the Bole Medhane Alem Church. “This is what I’ve been waiting for: a good Ethiopian product after all this talk about economic growth.”

Holland Car’s general manager, Tadesse Tessema, convinced the Ethiopian government to lower import taxes on spare parts, making the business even more attractive. Shortly after, he presented three models, all named after Ethiopian rivers: Abay, Tekeze and Awash. Recently they launched a new family car: Shebele.

Other car assemblers followed suit. First there was competition from Holland Car’s former Chinese partner. Yangfan Motors launched three models of its Lifan Cars in Ethiopia. One of them shows resemblance to Holland Car’s Abay. The two companies split after a dispute and used to produce the model together.

A nice spectacle in the streets of Addis is Lifan’s Mini-Cooper look-a-like, the Lifan 320. The company prefers to describe it in masculine terms as a “mini-SUV with the power of a bear”, but it’s a “typical lady’s car”, according to car salesman Thomas Mulune.

The latest competitor for the passenger’s car market is Hyundai. The South Korean company enters Ethiopia with heavy artillery, Haile Gebreselassie being its ambassador, investor and sole importer. The assembly plant is under construction and personnel are to be trained to assure “international standards”, the successful athlete said.

A model recently assembled by BH Trading and Manufacturing Plc

Satisfied with the competition in the market he initiated, Holland Car CEO Tadesse is preparing for a new step. He’s building a gigantic plant that will be finished in two months. From that day, he will slowly reduce the import of parts and work towards producing full Ethiopian cars.

“As a pilot, I’m can choose between different cars from all over the world,” Sisha says. “But I prefer to encourage guys like Tadesse and Haile by buying Ethiopian ones. If the quality is there, of course.”