The energy sector: brighter light at the end of the tunnel   Part I By Belayneh Akalu 08/16/13   With landmass of 1.1 million square kilometers, Ethiopia is the third sizeable and second populous nation in Sub-Saharan Africa with estimated population of about 91 million. United Nations Development program [UNDP, 2010] ranked Ethiopia 157th in the human development index, with per capita average annual income of 120$ and about 40% of the population below poverty line. The population of Ethiopia is currently 91 million and Ethiopia is the 13th largest country in the World in terms of population (The World Fact Book, July, 2011). Since Ethiopia has the 8th fastest population growth rate in the World, the population of Ethiopia will reach 200 million people in just 25 years, becoming the 9th largest country in the World, surpassing Russia and other countries. The stress such a huge population explosion could cause on the socio - economic and political stability of the country would obviously be significant. With diminishing natural resources of the country, resource and wealth distribution would become more daunting than they already are. That would create a conducive environment to breed conflict. As could be expected, the remedy for all these social, economic and political evils is development. As the role of access to energy in the march towards development is vital, Ethiopia needs to strengthen its efforts to exploit its energy sources. A sound plan that needs to be executed thoroughly is at the core of such efforts. But the question is, is the country gearing itself in that direction? To find an answer to that, let’s take a look at what the country has been doing to utilize its renewable and non-renewable energy resources. The Scaling - Up Renewable Energy Program (SREP) Ethiopia Investment Plan (Draft Final) of January 2012 denoted that the energy sector in Ethiopia can be generally categorized in to two major components: traditional and modern. The traditional refers to biomass usage while the modern entails modern fuels i.e electricity and petroleum. As more than 80% of the country's population is engaged in the small-scale agricultural sector and live in rural areas, traditional energy sources represent the principal source of Energy in Ethiopia.   Domestic energy requirements in rural and urban areas are, according to the SREP document, mostly met from wood, animal dung and agricultural residues. At the national level it is estimated that biomass fuels meet 88 % of total energy consumed in the country. In urban areas access to petroleum fuels and electricity has enabled a significant proportion of the population there to employ these for cooking and other domestic energy requirements. It is no wonder that access to biomass fuels has declined significantly in all areas of the country and drastically in some parts considering our heavy reliance on the resource. The SREP document further states that reduced access to woody biomass has had serious developmental and social impacts. Less access to wood means more has to come from other sources of biomass to meet demand for fuel. This has eroded the balance between what goes in for agricultural production and animal manure for fertilizer, and what goes out of it, i.e. food for humans and animals. It also means that women and children, the section of society who are normally assigned with fire wood collection, have to go much further to carry out their duties cutting short the amount of time they would spend on other social and economic activities. A survey by the Central Statistics Agency (CSA) in 2004 showed that about 71.1% of the total households use kerosene for lighting followed by firewood (15.7%) and electricity (12.9%). A higher proportion of urban residents use electricity (75.3%) for lighting. Major types of cooking fuel used by all households are firewood, leaves, dung cakes and kerosene. The study by CSA at the country level, suggests that about 81.4 % of the households use firewood, around 11.5 % cook with leaves and dung cakes and only 2.4 % use kerosene for cooking. The majority of rural households use firewood (84.4 %) and few of them (12.7 %) use leaves and dung cakes. The use of modern source of cooking fuel such as butane gas, electricity and kerosene for cooking is uncommon in the rural areas (0.4 %). Use of kerosene is common in urban areas and stands at 13.8 % following firewood (65.4 %). Charcoal (7.7 %), electricity (2.4 %) and leaves (5.3 %) are also used by urban households. On the other hand, only 0.2 % of the households in rural areas are observed to use charcoal for cooking. The SREP document shows that total energy sales of the Interconnected System (ICS) – the main electricity grid and the Self-Contained System (SCS) – separate mini grids, stand at 3894 GWh during the 2009/2010 fiscal year. Of this the sales in the ICS take about 98% of the total. Category-wise the domestic consumption takes the highest share at 38% seconded by the total industrial consumption (LV and HV) which is 37%.   A per capita electricity consumption of 77 kwh/year clearly denotes that there is a high reliance on biomass as the source of energy in Ethiopia considering the average per capita energy consumption for sub-saharan Africa is 500 kwh/year. The system installed capacity is 2167 mw of which hydro power makes up 94% while wind and geothermal constitute 4% and diesel fills up the rest.      As a result of the double digit economic growth of the last decade and the considerable population surge, Ethiopia has been experiencing increased energy consumption and unmet demand over the last few years. In the Climate-Resilient Green Economy (CRGE) initiative that has been launched in Ethiopia and also during the COP17 Meeting in Durban, South Africa, a demand forecast has been prepared. The forecast is based on GDP data, sectoral energy consumption intensities, and projections of the potential for increasing energy efficiency. Accordingly, total power demand is projected to grow from 4 TWh in 2010 to a maximum of nearly 70 TWh in 2030. The steep increase in demand (14% per annum) reflects both the growing electrification of the country – the target for 2020 is to expand access to grid connection to nearly 100% of the country (measured in area coverage) – and rapid growth of electricity-intensive industries – projected at a rate of more than 15% a year, outpacing even the overall GDP growth rate. When specific energy efficiency measures are factored into the forecast the demand requirement will be limited to 50 TWh in 2030, which still represents a more than tenfold increase over today’s demand.   In this regard, the major objective of the energy sector, as stated in the Scaling-up Renewable Energy Program (SREP), during the existing 5 year Growth and Transformation Plan period (GTP) and beyond is to meet the demand for energy in the country by providing sufficient and reliable power supply that meets international standards at all times. This objective will be achieved by accelerating and completing the construction of hydroelectric power and other renewable energy generation projects, expanding and strengthening the existing transmission and distribution lines to provide improved access to rural villages all over the country. An additional objective is to export power to the neighboring countries. Modernizing the distribution system will also be considered, so as to reduce power losses to international benchmark levels. Development of alternative energy from renewable sources such as wind, geothermal, solar, biomass as well as energy efficiency measures will be a key part of Ethiopia’s energy mix and integrated with the country’s new Climate Resilient Green Economy (CRGE) Strategy, which has the ambitious objective of transforming Ethiopia into climate resilient green economy by 2025. The GTP and the CRGE – as well as other national development plans – are explicitly focused on addressing issues of energy access, quality of supply and productive energy use in the context of new energy policies and planning.   The GTP sets the major outcomes for the energy sector in the short-term, as well as the CRGE, which provides a road map for the country’s long-term low-carbon growth path. The GTP aims to increase the power generation capacity of the country from the present level of 2000 MW to 10,000 MW by the end of 2015. The aim is to address both domestic demand while exporting surplus power to neighboring countries and beyond. The need to expand the transmission and distribution system is also emphasized in order to deliver the energy generated to the consumer in an efficient and reliable manner. The GTP further envisages increasing the customer base of the power utility from the current level of 2 million to 4 million and the universal electricity access rate from 45% to 75%.   It further aims at increasing the dissemination of renewable energy technologies and increasing access to modern energy sources in order to reduce the deforestation rate and mitigate carbon emissions. At the end of the GTP period, the majority of women and girls in at least 80 % of households will be beneficiaries of modern energy services from dissemination of efficient cook stoves and other RE sources since in most cases they are in charge of collecting firewood and other types of fuel. This has an effect on their lives namely in terms of health, less access to school for girls, risk of violence and abduction. Furthermore, in many cases, the time used in the collection of firewood could be used for economic activities (for women), and better attendance to school (for girls).   Some of the major energy goals of the GTP include:- increasing power generation capacity from 2,000 mw to 10,000 mw, increasing grid access from 41% to 75% of the population, doubling grid connections from 2 million to 4 million households, increasing households supplied with at least one kind of modern, efficient and renewable energy source/technology from 16% to 80%, electrifying more than 1,500 towns and villages, disseminating more than 3 million solar lanterns and 9 million efficient cook stoves with the assistance of development partners like AfDB, WB and others.   In a short account of the country’s non-renewable resources, as Ethiopia is not a petroleum producing country, all the hydrocarbon products (benzene, kerosene, diesel, butane etc) consumed in the country are imported. Considering the over the top price of these products in the international market, one can easily deduct that they take up a significant portion of the foreign currency earnings of the country. In that regard, the oil exploration activities in the country can be taken into account.   A comprehensive short description of the energy policy pillars of the country would include: the gradual shift from traditional energy sources to modern ones, availing reliable energy at affordable prices, streamlining the development and utilization of energy resources, prioritizing indigenous energy resources to attain self sufficiency, increasing energy efficiency and ensuring environmental sustainability.   The government has also put a set of activities that need to be carried out to ensure that the policy objectives would be achieved. These include:- 1. electric power generation construction program, 2. electric transmission lines construction program, 3. power distribution and expansion program which can be grid based or off-grid rural electrification, 4. national energy regulatory system for electricity and energy efficiency, 5. alternative energy development and  promotion, and 6. capacity building.   As discussed above, the country’s biomass makes up a staggeringly high proportion of its energy resources. The high population growth rate and economic growth have been pushing the demand for energy considerably. We then raised a question on whether we have an energy policy that eases the destruction of biomass and distribute the pressure on other energy resources. The aforementioned goals set by the government to identify the looming problem and design a sensible set of activities to be accomplished is a testament to the government’s journey in the right path. However, as the presence of sound policies would not mean anything unless it is backed with tangible accomplishments in that direction, we need to take a closer look at what things are being done to optimize the utilization of each of the energy resources.   Accordingly, we will deal with the hydroelectric, wind, geothermal and solar sections of the renewable energy resources of the country and the oil exploration developments made thus far in the second part of this article.