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The African Development Bank (AfDB) has approved a third round of loans, worth US$115mn, for construction of the power transmission line between Ethiopia and Kenya
The bank AfDB had previously approved the second phase of funding for the project with US$348mn three months ago.
The US$1.26bn project will consist of a 1,068km high-voltage transmission line with a power transfer capacity of up to 2,000MW.
AfBD has claimed that the project will position Ethiopia as the main powerhouse and Kenya as the main hub for power trading in the East African region.
According to the bank, on completion, the project will promote power transfers, economic trading and regional integration. The Ethiopia-Kenya power line will also enable Ethiopia to start substantial electricity exports to Kenya.
The Ethiopian government has said it will invest more than US$12bn to increase its hydropower generating capacity from the current level of 2,000MW to 10,000MW by 2015, and then to more than 40,000MW by 2035.