Energy and hydropower

Ethiopia has 14 major rivers, which flow from its highlands, including the Nile. The country has the largest water reserves in Africa. As of 2012, hydroelectric plants represented around 88.2% of the total installed electricity capacity. The remaining electrical power was generated from fossil fuels (8.3%) and other renewable sources (3.6%). The electrification rate for the total population in 2013 was 24%, with 85% coverage in urban areas and 10% coverage in rural areas. As of 2014, total electricity production was 9.5 billion kWh and consumption was 6.7 billion kWh. There were 1.1 billion kWh in electricity exports, 0 kWh in electricity imports, and 2.4 million kW of installed generating capacity.

Ethiopia delivers roughly 81% of water volume to the Nile through the river basins of the Blue Nile, Sobat River and Atbara. In 1959, Egypt and Sudan signed a bilateral treaty, the 1959 Nile Waters Agreement, which gave both countries exclusive maritime rights over the Nile waters. Ever since, Egypt under international law vetoed almost all projects in Ethiopia that sought to utilize the local Nile tributaries. This had the effect of discouraging external financing of hydropower and irrigation projects in western Ethiopia, thereby impeding water resource-based economic development projects. However, Ethiopia is in the process of constructing a large 6,450 MW hydroelectric dam on the Blue Nile River. When completed, this Grand Ethiopian Renaissance Dam is slated to be the largest hydroelectric power station on the continent. The Gibe III hydroelectric project already generates an estimated 1,870-MW.