AfDB Awards Contract for 30 MW Solar PV Plant in Eritrea

The African Development Bank (AfDB) has awarded the contract for the construction of the Dekemhare 30MW Solar PV Plant to China Energy Engineering Group Shanxi Electric Power. Construction Co. Ltd. The grid-connected plant will be located near the town of Dekemhare, 40 km southeast of the capital Asmara. The company was selected from a list of 11 bidders.

The AfDB approved financing for the project in March 2023 and estimates a total project cost of $59.21million. The bank is providing 91% of this funding through its African Development Fund (ADF-15)  and Transition Support Facility grants. The Eritrean government will provide the remaining 9% as a counterpart contribution. 

The project consists of two components, the power generation phase, which includes the design and construction of a 30 MW grid-connected solar PV plant plus a 15 MW/30 MWh battery energy storage system; a 33/66 kV substation; and a 66 kV transmission line connected to the existing transmission line between East Asmara and Dekemhare.

The second component is technical assistance and capacity-building support. This will enable energy experts in Eritrea to assess the feasibility of large-scale clean energy projects within the Eritrea  Electricity Corporation’s (EEC) network. It also includes capacity building in network planning and design, performance improvement, and financial, legal, operational and environmental aspects.

The contractor, China Energy Engineering Group, will design, supply, and install the  30MW solar PV plant, battery energy storage system and associated facilities. The construction is expected to take 24 months. 
When completed, the plant will increase Eritrea’s grid generation capacity to 185 MW and renewable energy share in the grid energy mix to 23% from 3%. The plant will also reduce greenhouse gas emissions by 42,910 tCO2-eq annually as well as the cost of power generation to 18.5 US cents per kilowatt hour from the 20 US cents per kilowatt hour that diesel fuel generation costs.

Electricity supply in Eritrea

Electricity access in Eritrea is quite low as only 52% of the population has access. In rural areas, it is 39%. Power supply is mainly provided by oil-based generator plants. According to Power Africa, only two diesel power plants provide about 90% of the installed generation capacity — Hirgigo 132 MW and Belaza 17 MW. However, only a fraction (about 35MW) of the total installed capacity is available as consistent infrastructure breakdown and lack of maintenance have hampered the operations of these generating plants. 

Eritrea has huge renewable energy potential as the country has a vast coastline and highlands that are optimal for wind power generation. In 2018 Eritrea drafted a National Energy Policy which aims to increase electricity access in the country and increase clean energy contribution to the grid to 20% by 2030; reduce fossil fuel dependency, and lower greenhouse gas emissions.