CEO Engineer Ashebir Balcha Confirms Project Financing Shortfall as Construction Reaches 77 Percent with Target to Hit 87 Percent in 2019 E.C.
By Staff Writer
(Nairobi, Kenya) — Ethiopian Electric Power (EEP) is in active negotiations with Italian financial institutions to secure a €400 million commercial loan to address ongoing financing shortfalls at the Koysha Hydroelectric Project.
The loan negotiations follow explicit authorization from the International Monetary Fund (IMF), which granted Ethiopia a special exemption to access external commercial credit specifically designated for the flagship energy project.
Speaking during a performance briefing reviewing the 2018 E.C. budget year and outlining plans for 2019 E.C., EEP Chief Executive Officer Engineer Ashebir Balcha confirmed that physical construction at the Koysha Dam has reached 77 percent completion. Despite experiencing severe budget constraints, EEP sustained ongoing construction through federal support and internal utility revenues.
For the upcoming 2019 E.C. budget year, EEP aims to advance overall construction from 77 percent to 87 percent completion, raise the main dam height to 201 meters, and fully complete the civil dam structure. Power generation turbines are not yet ready for operational rollout, with current efforts strictly focused on completing the main civil structures.
Total costs for the Koysha Hydroelectric Project are currently approaching €3 billion before any electrical output is realized. Engineer Ashebir acknowledged that the project continues to face a significant funding deficit, prompting external commercial borrowing.
Italian lenders have signaled preliminary willingness to provide up to €400 million out of the estimated €500 million operational gap. Following the expected securing of the €400 million commercial package, EEP plans to cover the remaining balance using internal revenue streams.
Originally intended under the primary contract to take seven years, project completion timelines have been extended by two to three additional years due to compounding financial delays.
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