Enel Green Power, Orchid win 100MW solar power plant bid
Enel Green Power, a leading European renewable energy developer, and its local partner in Ethiopia, Orchid Business Group, have won the bid put up by Ethiopian Electric Power to build a 100MW solar power plant in Metehara town, Oromia Regional State.
In February 2017 the Ethiopian Electric Power (EEP) invited international and local energy firms to participate in the bid to build, own and operate a 100MW solar power plant in Metehara town, located 230km east of Addis Ababa in East Shoa zone of the Oromia Regional State, an area that enjoys high levels of solar radiation.
Five international energy firms – Enel Green Power, Fotowatio Renewable Ventures BV (FRV), Meridiam-Solairedirect Consortium, The Building Energy SPA. Consortium, and CCE Oasis Technology Corporation – participated in the open international tender. Enel Green Power (EGP) partnered with Orchid Business Group, a renowned Ethiopian investment group to build the solar plant.
In a statement sent to The Reporter EGP said that it has been selected as the preferred bidder for 100MW solar power project. “The consortium has the right to develop, build and operate the 100MW of PV capacity in Metehara,” the company said.
The Ethiopian government’s second Growth and Transportation Plan (GTP-II) is expected to generate nearly 12,000MW of new hydro, wind, geothermal and solar capacity in partnership with the private sector, with the aim of meeting the country’s electrification needs while diversifying its generation mix in line with the government’s energy plan for the years up to 2020.
Strategy and Investment director with EEP Mekuria Lemma confirmed to The Reporter that Enel Green Power has own the bid. “Enel Green Power has scored the highest points in both the technical and financial evaluations,” Mekuria said.
Mekuria told The Reporter that EEP and EGP will start negotiations on details of the Power Purchasing Agreement (PPA). “The company will come up with talking points and together with our consultants we hope to start the negotiation soon,” he said.
Once the negotiation is finalised, the draft PAA will be presented to the Ethiopian Electric Authority – the regulatory body of the power sector – for endorsement. After the approval, EEP and EGP would sign the PPA. EEP would buy all the electric power generated by Enel Green Power for 20 years.
Antonio Cammisecra, CEO Enel Green Power, told The Reporter that the tender process was done in a very transparent manner. Cammisecra said Ethiopia has the potential to become a key market for Enel’s strategy in Africa. “The country has plenty of renewable energy sources that can generate energy at affordable rates thanks to modern green technologies. Additionally, Ethiopia boasts a stable regulatory framework, based on tenders and PPAs, and steady energy demand growth, which is also sustained by a long-term electrification plan. We are more than happy to invest in this country, with the aim of meeting its energy demand through our renewable energy expertise, helping to boost Ethiopia’s overall development while supporting local communities with our sustainability initiatives.”
Enel Green Power is a subsidiary company of Enel Group established in 2008 in Rome Italy. Enel Green Power develops renewable energy sources including hydro, solar, wind and geothermal energy sources in Europe, the US, Central and South America and Asia. It has also started operations in African countries including in South Africa, Morocco and Zambia.
Enel Green Power teamed up with Orchid Business Group to develop the Metehara Solar power plant. Orchid has a twenty percent stake in the solar project and it will co-invest in the project. Orchid Business Group PLC is an Ethiopian company primarily operating in the areas of infrastructure, construction and logistics. The company was established by a renowned Ethiopian businesswoman, Akiko Seyoum Ambaye, 15 years ago. Orchid will be the contractor that will build some parts of the power plant.
The EGP-led consortium will be investing approximately USD 120 million in the construction of the solar plant. The European Investment Bank pledged support to the Metehara Solar energy development project. Christophe Litt, EIB’s head of representation to Ethiopia and the African Union, said that the bank was closely looking at the project.
According to Cammisecra, it will take 14 months to complete construction and start generation. The Metehara plant is expected to enter into operation in 2019. Once up and running, the facility will be able to generate approximately 280 GWh per year, while avoiding the emission of around 296,000 tons of CO2 into the atmosphere.
The country's installed generation capacity has reached 4,280MW – 92 percent hydro, six percent wind and two percent thermal.
Currently, EEP is processing two more tenders for the construction of solar power plants in Mekelle and Humera towns each having 100MW installed generation capacity. Under the World Bank’s Scale Up Solar Program, two solar power plants are proposed to be built in the Afar and Somali regional states with each having 150MW. EEP plans to develop a total of five solar plants with an aggregate generation capacity of 800 MW of solar energy in the GTP-II.