The Ethiopian Electric Power headed by Engineer Azeb Asnake signed on Oct.14 a Memorandum of Understanding (MoU) with a US-based company Green Technology Africa Inc. (GTA) to generate 300 megawatts of solar energy.

Ethiopia goes into the last of the four elements, preparing to invest 600 million dollars for solar power generation, following its investments in hydroelectric, wind and geothermal power generations.

The Ethiopian Electric Power (EEP), whose executives are largely mum on the subject, signed a Memorandum of Understanding (MoU) with Green Technology Africa Inc. (GTA), with Azeb Asnake (Eng), chief executive officer (CEO) of the EEP, and Dereje Mesfin, president of the GTA, as the signatories.

Azeb confirmed the deal but declined to discuss details. It is a position echoed in the corridors of the utility monopoly.

“We are not ready to give any further details about the project and the MoU signed with the GTA,” said Misiker Negash, external relations director at the EEP.

GTA has, nevertheless, published the story on its website, applauding the Ethiopian government for, “supporting organizations that have been launched internationally by Ethiopians that have acquired years of training and professional expertise overseas and choose to return home to go with local specialists to demonstrate best practices and solutions for a greener Ethiopia.”

Green Technology Africa Inc. (GTA) was founded in Arlington, Virginia, by Dereje Mesfin, according to its web site, with the aim to supply innovative solutions at cost effective prices and technologies for local and international business. This project, the first of its sort in the country, could generate 300mw of electric power.

It will be a welcome addition to the national grid, which received close to 2,000mw electric power from nine dams. The nation’s aggressive drive to get electric power from all sources – water, dry land, wind and now solar – is in a bid to expand national electricity coverage to 75pc by next year as outlined in the GTP. The total coverage has now reached at 55pc.

GTA will deliver the electric power from solar sources, in a turnkey project to be set up in Dire Dawa, Kombolcha and Desse. The company hopes the MoU it signed with EEP managers will enable it to start a full and complete feasibility study on the identified areas, it says.

Copies of its prefeasibility study have been sent to the EEP and Ministry of Water, Irrigation and Energy (MoWIE), the company confirmed in its email to Fortune. The project is anticipated to begin in six months, according to this email response. It will take another six months for opportunity identification and project validation, and two years for project execution, acquisitions and building infrastructure.

This project is a huge development in the power sector and it will encourage local companies to engage in such kind of mega projects, said Dereje Woldegabriel, an Ethiopian businessman running Lydetco Plc, which has been supplying solar system components to Non Governmental Organizations (NGOs) and the private sector. The power generated by the new project is vast, compared to small solar off-grid projects, and it will go directly to the national grid, says Dereje Woldegebriel, who is aware of the signing of the MoU, but not involved.

A 2011 study by GIZ shows that Ethiopia has a huge solar power potential, especially in western and eastern lowlands which receive high density of radiation, even though the Ethiopian solar market is still at an early development stage with an estimated installed capacity of five megawatt power. Demand comes mostly from off-grid areas which constitute 80pc of the country, according to a study conducted by GIZ.