The African Development Bank (AfDB) has become the first financier to com- mit funds for the construc-tion of a major power transmission line that will enable electricity trade between Kenya and Ethiopia.

The AfDB has approved a $231-million loan for the 1 055 km high-voltage trans-mission line to be built from 2013 to 2016.

The project has a price tag of $1.2-billion. The two countries are also hoping to raise funds from the World Bank and the French Agency for Development.

AfDB Ethiopia country programme officer Halima Hashi says the bank’s board is expected to appraise the project in the first quarter of the current financial year before giving final approval by June.

“The bank understands the importance of the project in propelling economic devel-opment in the two countries and that is why we are com-mitted to funding it,” he says.

The Ethiopia–Kenya interconnector, a high-voltage 400 kV double-circuit line, will enable Kenya to import 400 MW of electricity from Ethiopia from 2016.

Already the two countries have finalised a deal that will see Kenya import the elec-tricity at a cost of 0.0084c/kWh for a period of not less than 30 years.

Ethiopia, which is under-taking massive investments in the power sector, projects that electricity exports could rake in $407-million annually, more than the Horn of Africa nation earns from exports of coffee, its major foreign currency earner.

Besides Kenya, the country has also entered into agree-ments to supply 200 MW to Djibouti and 200 MW to Sudan.

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