Rural electricity is set to unlock the potential of Ethiopia's economy, according to a report by Rocky Mountain Institute
Ethiopia faces numerous threats to national food security including disrupted trade and import channels, food price spikes, water supply risks, and delayed or compromised harvest yields during COVID-19.
Ongoing efforts to transform the agriculture sector in Ethiopia therefore continue to be critical, and while Ethiopia targets universal electrification by 2025, more than 69 per cent of people in rural areas have little to no access to electricity.
In the report, Rocky Mountain Institute shows how electricity can unlock US$4bn in new value across six agricultural processing or small business opportunities in some of Ethiopia’s most important crops, while saving money for farmers who switch to electricity from expensive alternatives such as diesel.
Rocky Mountain Institute’s first rural electrification study in Ethiopia, ‘Capturing the Productive Use Dividend’, report provides the following insights on the productive uses of energy in newly electrified areas, these include:
Rural smallholders can use electricity to unlock or accelerate revenue streams from agricultural productivity and processing worth US$4bn by 2025.
Making the switch to electricity saves communities another US$120mn in fuel costs, while unlocking an annual revenue stream of US$22mn for the utility.
Providing the appliances for this market is a US$380mn business opportunity for local manufacturers, importers and distributors.