The African Development Bank Group (AfDB) has approved a financing package of up to US$110 million to support the development of the 300MW Aysha Wind Project, Ethiopia's first wind-based Independent Power Producer (IPP) and, upon completion, the country's largest wind power plant.
Approved by the Bank's Board of Directors on 15 July, the project has an estimated total cost of US$508 million. The AfDB's financing package comprises up to US$80 million from its ordinary resources, US$20 million from the Clean Technology Fund, and US$10 million from the Sustainable Energy Fund for Africa (SEFA). The Bank will also help mobilise an additional US$381.1 million in debt financing from other development finance institutions.
The project will be developed, owned, and operated by AMEA Power and involves the design, construction, operation, and maintenance of a 300MW greenfield wind farm near Aysha in Ethiopia's Somali Region. It also includes the construction of a five-kilometre transmission line and upgrades to the existing Aysha II substation. Under a 25-year Power Purchase Agreement (PPA), Ethiopian Electric Power will serve as the sole off-taker and will assume ownership of the transmission infrastructure upon completion.
Once operational, the wind farm is expected to generate approximately 1,189 gigawatt-hours (GWh) of clean electricity annually, strengthening Ethiopia's electricity supply while advancing the country's target of achieving universal electricity access by 2030. The project is also expected to diversify Ethiopia's power generation mix, which currently relies on hydropower for approximately 96% of installed generation capacity, improving the resilience of the national grid against climate-related hydrological risks.
Commenting on the approval, Wale Shonibare, Director for Energy Financial Solutions, Policy, and Regulations at the African Development Bank Group, described the project as a landmark transaction for Ethiopia's power sector, noting that the financing structure combines long-tenor debt, concessional funding, and innovative risk mitigation mechanisms that could serve as a model for future private-sector power investments in the country.
Beyond its contribution to energy security, the project is expected to deliver significant environmental and socio-economic benefits. The AfDB estimates the facility will avoid approximately 1.39 million tonnes of carbon dioxide emissions over the 25-year PPA period. Construction activities are projected to create up to 1,525 direct jobs, while the operational phase will support 30 permanent positions. An estimated 35,645 indirect jobs are also expected to be generated across the supply chain and broader economy.
The Aysha Wind Project supports Ethiopia's National Electrification Program, its Nationally Determined Contribution (NDC) under the Paris Agreement, and the country's long-term net-zero ambitions by accelerating private-sector investment in renewable energy.
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