Success, Gaps and Challenges of Power Sector Reform in Ethiopia

Zelalem Girma

doi:doi:10.11648/j.ajme.20200601.15

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Success, Gaps and Challenges of Power Sector Reform in Ethiopia

Zelalem Girma

Published in American Journal of Modern Energy (Volume 6, Issue 1)

Received: 5 September 2019 Accepted: 11 February 2020 Published: 18 February 2020

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Abstract

Ethiopia faces chronic power problems including insufficient generation capacity, low connectivity and poor reliability of transmission and distribution all of which constrain development. The Ethiopian power sector reform is necessitated by poor technical and financial performance of the power sector. The reform was initiated during 1997 just like any other Africa country due to deregulation of the power sector market in the world which aimed to increase the technical and financial performance of the sector. The government initiative to reform the power sector was backed by world bank by transforming Ethiopia Electric Light and Power Authority (EELPA) into Ethiopia Electric Corporation (EEPCO) in order to give the utility to work in business mind rather than as simple service sector. The main reason for powers sector reform is inability of state own vertically integrated utility to mobilize sufficient capital for the electricity sector development and expansion and waiting of federal government yearly allocated budget to perform its planned tasks. It is found that as most sub Saharan African countries including Ethiopia is in its initial steps of power sector reform even though there are some work done regarding corporatization, electricity amendment, management contract and tariff setting for independent power producers. The reform resulted in significant progress in connectivity and creating independent regulatory agency but failed to bring unbundling, encompassing independent power producers and improving transmission and distribution reliability. This article is based on country study by the author reviewing the status of power sector reform with special emphases on the success, gaps and challenges of the sector. The result of this study shows that power sector reform in Ethiopia has mixed result that gaps and challenges override the success due to weak institutional structure, weak project management and low skill capacity of human resources to implement the reform as intended, government inability to finance the reform process and the country still position itself at level-2 out of level-5 of maturity level of power sector reform.

Published in	American Journal of Modern Energy (Volume 6, Issue 1)
DOI	10.11648/j.ajme.20200601.15
Page(s)	33-42
Creative Commons	This is an Open Access article, distributed under the terms of the Creative Commons Attribution 4.0 International License (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted use, distribution and reproduction in any medium or format, provided the original work is properly cited.
Copyright	Copyright © The Author(s), 2020. Published by Science Publishing Group

Keywords

Power Sector Reform, EEPCO, Energy Policy, Ethiopia

References

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[3]	Ethiopia Geothermal Sector Development Project, world bankhttp://wwwcif.climateinvestmentfunds.org/sites/default/files/Ethiopia%20GSDP%20_%20PAD_4102014%20.pdfaccessed on Sept2, 2018.
[4]	Lighting Africawww.lightingafrica.org/wp-content/uploads/2016/07/Ethiopia-Market-Intelligence-Report_June2013.pdfaccessed on March 12, 2019.
[5]	ShiferawTelila Ethiopian power sector Progress briefing Washington DC, 2019 https://www.usea.org/sites/default/files/event/Ethiopian%20Power%20Sector%20Progress.pdf accessed on Sept 2019.
[6]	IEA, World Energy Statistics, 2017 and World Bank, World Development Indicator database, https://www.iea.org/data-and-statisticsaccessed on November 2019.
[7]	Energy progress report ESMAPhttps://trackingsdg7.esmap.org/country/ethiopiaaccessed on Jun 2019.
[8]	Investment Brief for the Energy Sector in Ethiopia, power Africa, https://www.usaid.gov/sites/default/files/documents/1860/Ethiopia_IG_2015_05_03.pdfaccessed on August 10, 2019.
[9]	StephenKarekezi and WaeniKithyoma Renewable Energy in Africa: Prospects and Limits, AFREPREN (2003) https://sustainabledevelopment.un.org/content/documents/nepadkarekezi.pdfaccessed on Oct 25, 2019.
[10]	Ethiopia Investment Plan https://www.oecd.org/env/cc/TADELE_FDRE%20Ethiopia%20Scaling%20-%20Up%20Renewable%20Energy%20Program%202012.pdfAccessed on Feb29, 2018.
[11]	Scaling - Up Renewable Energy ProgramEthiopia - Electric power transmission and distribution losses https://tradingeconomics.com/ethiopia/electric-power-transmission-and-distribution-losses-percent-of-output-wb-data.htmlaccessed on Jun 23, 2019.
[12]	Ethiopia begins test running power supply to Sudanhttp://www.tigraionline.com/articles/article120815.htmlaccessed on April 13, 2018.
[13]	Ethiopia-Kenya power systems interconnection project revision of environmental and social impact assessment and resettlement action plan studieshttp://www.afdb.org/fileadmin/uploads/afdb/Documents/Environmental-and-Social-Assessments/Ethiopia%20RAP%20Final%20Report.pdfaccessed on July 28, 2019.
[14]	Manfred. H, Simon. T and Lucia. D Energy in Africa: challenge and Opportunity, Springer Brief in Energyhttps://link.springer.com/content/pdf/10.1007%2F978-3-319-92219-5.pdf.
[15]	Ioannis N. Kessides, “The impacts of electricity sector reforms in developing countries,” Electr. J. 25 (6) (2012) 79–88.
[16]	The reform of the power sector in Africahttp://africa-toolkit.reeep.org/modules/Module4.pdfAccessedon Jan 2020.
[17]	Katharine. Nand Anton. E,”Demise of the standard model for power sector reform and the emergence of hybrid power markets, “Energy Policy 36 (2008) 3948–3960.
[18]	MengistuTeferra,“Power sector reforms in Ethiopia: options for promoting local investments in rural electriﬁcation,”Energy Policy 30 (2002) 967–975.
[19]	BekeleBayissa“A review of Ethiopian Energy policy and Bio-fuel strategy “Digest of Ethiopia’s National policies, strategies and program 2008.
[20]	Getahun Moges, electricity sector regulation, Ethiopia https://www.esi-africa.com/wp-content/uploads/Ethiopia%20electric%20power%20regulation%20presentation%20final.pdfAccessed on Sept 2019.
[21]	National Electrification Program 2.0 Integrated Planning for Universal Accesshttps://minigrids.org/wp-content/uploads/2019/04/Ethiopia-2.0.pdf Access Feb 6,2020.
[22]	Baseem. K and Pawan. S, “The Current and Future States of Ethiopia’s Energy Sector and Potential for Green Energy: A Comprehensive Study,” International Journal of Engineering Research in Africa 33: 115-139.

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APA Style

Zelalem Girma. (2020). Success, Gaps and Challenges of Power Sector Reform in Ethiopia. American Journal of Modern Energy, 6(1), 33-42. https://doi.org/10.11648/j.ajme.20200601.15

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Zelalem Girma. Success, Gaps and Challenges of Power Sector Reform in Ethiopia. Am. J. Mod. Energy 2020, 6(1), 33-42. doi: 10.11648/j.ajme.20200601.15

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Zelalem Girma. Success, Gaps and Challenges of Power Sector Reform in Ethiopia. Am J Mod Energy. 2020;6(1):33-42. doi: 10.11648/j.ajme.20200601.15

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@article{10.11648/j.ajme.20200601.15,
  author = {Zelalem Girma},
  title = {Success, Gaps and Challenges of Power Sector Reform in Ethiopia},
  journal = {American Journal of Modern Energy},
  volume = {6},
  number = {1},
  pages = {33-42},
  doi = {10.11648/j.ajme.20200601.15},
  url = {https://doi.org/10.11648/j.ajme.20200601.15},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajme.20200601.15},
  abstract = {Ethiopia faces chronic power problems including insufficient generation capacity, low connectivity and poor reliability of transmission and distribution all of which constrain development. The Ethiopian power sector reform is necessitated by poor technical and financial performance of the power sector. The reform was initiated during 1997 just like any other Africa country due to deregulation of the power sector market in the world which aimed to increase the technical and financial performance of the sector. The government initiative to reform the power sector was backed by world bank by transforming Ethiopia Electric Light and Power Authority (EELPA) into Ethiopia Electric Corporation (EEPCO) in order to give the utility to work in business mind rather than as simple service sector. The main reason for powers sector reform is inability of state own vertically integrated utility to mobilize sufficient capital for the electricity sector development and expansion and waiting of federal government yearly allocated budget to perform its planned tasks. It is found that as most sub Saharan African countries including Ethiopia is in its initial steps of power sector reform even though there are some work done regarding corporatization, electricity amendment, management contract and tariff setting for independent power producers. The reform resulted in significant progress in connectivity and creating independent regulatory agency but failed to bring unbundling, encompassing independent power producers and improving transmission and distribution reliability. This article is based on country study by the author reviewing the status of power sector reform with special emphases on the success, gaps and challenges of the sector. The result of this study shows that power sector reform in Ethiopia has mixed result that gaps and challenges override the success due to weak institutional structure, weak project management and low skill capacity of human resources to implement the reform as intended, government inability to finance the reform process and the country still position itself at level-2 out of level-5 of maturity level of power sector reform.},
 year = {2020}
}

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TY  - JOUR
T1  - Success, Gaps and Challenges of Power Sector Reform in Ethiopia
AU  - Zelalem Girma
Y1  - 2020/02/18
PY  - 2020
N1  - https://doi.org/10.11648/j.ajme.20200601.15
DO  - 10.11648/j.ajme.20200601.15
T2  - American Journal of Modern Energy
JF  - American Journal of Modern Energy
JO  - American Journal of Modern Energy
SP  - 33
EP  - 42
PB  - Science Publishing Group
SN  - 2575-3797
UR  - https://doi.org/10.11648/j.ajme.20200601.15
AB  - Ethiopia faces chronic power problems including insufficient generation capacity, low connectivity and poor reliability of transmission and distribution all of which constrain development. The Ethiopian power sector reform is necessitated by poor technical and financial performance of the power sector. The reform was initiated during 1997 just like any other Africa country due to deregulation of the power sector market in the world which aimed to increase the technical and financial performance of the sector. The government initiative to reform the power sector was backed by world bank by transforming Ethiopia Electric Light and Power Authority (EELPA) into Ethiopia Electric Corporation (EEPCO) in order to give the utility to work in business mind rather than as simple service sector. The main reason for powers sector reform is inability of state own vertically integrated utility to mobilize sufficient capital for the electricity sector development and expansion and waiting of federal government yearly allocated budget to perform its planned tasks. It is found that as most sub Saharan African countries including Ethiopia is in its initial steps of power sector reform even though there are some work done regarding corporatization, electricity amendment, management contract and tariff setting for independent power producers. The reform resulted in significant progress in connectivity and creating independent regulatory agency but failed to bring unbundling, encompassing independent power producers and improving transmission and distribution reliability. This article is based on country study by the author reviewing the status of power sector reform with special emphases on the success, gaps and challenges of the sector. The result of this study shows that power sector reform in Ethiopia has mixed result that gaps and challenges override the success due to weak institutional structure, weak project management and low skill capacity of human resources to implement the reform as intended, government inability to finance the reform process and the country still position itself at level-2 out of level-5 of maturity level of power sector reform.
VL  - 6
IS  - 1
ER  -

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Author Information

Zelalem Girma

Electrical and Computer Engineering Department, Arba Minch Institute of Technology, Arba Minch University, Arba Minch, Ethiopia

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Zelalem Girma. (2020). Success, Gaps and Challenges of Power Sector Reform in Ethiopia. American Journal of Modern Energy, 6(1), 33-42. https://doi.org/10.11648/j.ajme.20200601.15

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ACS Style

Zelalem Girma. Success, Gaps and Challenges of Power Sector Reform in Ethiopia. Am. J. Mod. Energy 2020, 6(1), 33-42. doi: 10.11648/j.ajme.20200601.15

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AMA Style

Zelalem Girma. Success, Gaps and Challenges of Power Sector Reform in Ethiopia. Am J Mod Energy. 2020;6(1):33-42. doi: 10.11648/j.ajme.20200601.15

Copy | Download

@article{10.11648/j.ajme.20200601.15,
  author = {Zelalem Girma},
  title = {Success, Gaps and Challenges of Power Sector Reform in Ethiopia},
  journal = {American Journal of Modern Energy},
  volume = {6},
  number = {1},
  pages = {33-42},
  doi = {10.11648/j.ajme.20200601.15},
  url = {https://doi.org/10.11648/j.ajme.20200601.15},
  eprint = {https://article.sciencepublishinggroup.com/pdf/10.11648.j.ajme.20200601.15},
  abstract = {Ethiopia faces chronic power problems including insufficient generation capacity, low connectivity and poor reliability of transmission and distribution all of which constrain development. The Ethiopian power sector reform is necessitated by poor technical and financial performance of the power sector. The reform was initiated during 1997 just like any other Africa country due to deregulation of the power sector market in the world which aimed to increase the technical and financial performance of the sector. The government initiative to reform the power sector was backed by world bank by transforming Ethiopia Electric Light and Power Authority (EELPA) into Ethiopia Electric Corporation (EEPCO) in order to give the utility to work in business mind rather than as simple service sector. The main reason for powers sector reform is inability of state own vertically integrated utility to mobilize sufficient capital for the electricity sector development and expansion and waiting of federal government yearly allocated budget to perform its planned tasks. It is found that as most sub Saharan African countries including Ethiopia is in its initial steps of power sector reform even though there are some work done regarding corporatization, electricity amendment, management contract and tariff setting for independent power producers. The reform resulted in significant progress in connectivity and creating independent regulatory agency but failed to bring unbundling, encompassing independent power producers and improving transmission and distribution reliability. This article is based on country study by the author reviewing the status of power sector reform with special emphases on the success, gaps and challenges of the sector. The result of this study shows that power sector reform in Ethiopia has mixed result that gaps and challenges override the success due to weak institutional structure, weak project management and low skill capacity of human resources to implement the reform as intended, government inability to finance the reform process and the country still position itself at level-2 out of level-5 of maturity level of power sector reform.},
 year = {2020}
}

Copy | Download

TY  - JOUR
T1  - Success, Gaps and Challenges of Power Sector Reform in Ethiopia
AU  - Zelalem Girma
Y1  - 2020/02/18
PY  - 2020
N1  - https://doi.org/10.11648/j.ajme.20200601.15
DO  - 10.11648/j.ajme.20200601.15
T2  - American Journal of Modern Energy
JF  - American Journal of Modern Energy
JO  - American Journal of Modern Energy
SP  - 33
EP  - 42
PB  - Science Publishing Group
SN  - 2575-3797
UR  - https://doi.org/10.11648/j.ajme.20200601.15
AB  - Ethiopia faces chronic power problems including insufficient generation capacity, low connectivity and poor reliability of transmission and distribution all of which constrain development. The Ethiopian power sector reform is necessitated by poor technical and financial performance of the power sector. The reform was initiated during 1997 just like any other Africa country due to deregulation of the power sector market in the world which aimed to increase the technical and financial performance of the sector. The government initiative to reform the power sector was backed by world bank by transforming Ethiopia Electric Light and Power Authority (EELPA) into Ethiopia Electric Corporation (EEPCO) in order to give the utility to work in business mind rather than as simple service sector. The main reason for powers sector reform is inability of state own vertically integrated utility to mobilize sufficient capital for the electricity sector development and expansion and waiting of federal government yearly allocated budget to perform its planned tasks. It is found that as most sub Saharan African countries including Ethiopia is in its initial steps of power sector reform even though there are some work done regarding corporatization, electricity amendment, management contract and tariff setting for independent power producers. The reform resulted in significant progress in connectivity and creating independent regulatory agency but failed to bring unbundling, encompassing independent power producers and improving transmission and distribution reliability. This article is based on country study by the author reviewing the status of power sector reform with special emphases on the success, gaps and challenges of the sector. The result of this study shows that power sector reform in Ethiopia has mixed result that gaps and challenges override the success due to weak institutional structure, weak project management and low skill capacity of human resources to implement the reform as intended, government inability to finance the reform process and the country still position itself at level-2 out of level-5 of maturity level of power sector reform.
VL  - 6
IS  - 1
ER  -

Copy | Download