The Ethiopian parliament has approved a loan agreement between the country’s finance ministry and Danish lender Danske Bank A/S (CPH:DANSKE). The loan which was agreed upon last week, is aimed at financing the 100-MW Assela wind farm project.
The loan which is to be repaid in 20 years, is for EUR 117.3 million (USD 136.5m). According to the parliament’s website, the loan was approved unanimously by the House of Peoples’ Representatives, and includes a five-year grace period.
The Danske Bank loan is supported by the government of Denmark through the country’s ministry of foreign affairs’ development assistance Danida.
With the funds made available, the Assela project is now advancing towards the construction phase.
Wind turbine maker Siemens Gamesa Renewable Energy SA (BME:SGRE) have been saddled with the responsibility of building the wind farm. The farm is expected to be located near the town of Iteya in the Oromia regional state, some 150 kilometres (93.2 miles) south of Addis Ababa.
The Danish embassy in Addis Ababa said once operations at the farm commence, the 29-turbine wind farm is expected to generate some 330,000 kWh annually and supply electricity to more than three million people.
In a statement provided by the Danish embassy, Seleshi Bekele, the Ethiopian minister of water, irrigation and energy, said “I am pleased to see the agreement to develop the Assela I Wind Farm, which will diversify the Ethiopian renewable energy mix, has been passed by the Parliament. I am grateful to the Danish government’s generosity to provide grant and concessional finance.”