House Approves 145.8 million USD Loan for Power Sector Modernization

Addis Ababa, October 13, 2026 (ENA) —Ethiopia’s House of People's Representatives (HPR) has unanimously approved a 145.8 million USD concessional loan agreement with the International Development Association (IDA) to fund the first phase of the Power Sector Reform, Investment, and Modernization Project.

The approval came during the 7th House’s second regular session of its first year, where lawmakers reviewed and passed the draft proclamation ratifying the supplementary financing agreement signed between the Ethiopian government and the IDA.

 

Presenting the agreement to the House, Government Chief Whip Fekadu Tessema stated that the funds will be used to modernize Addis Ababa’s power infrastructure.

The key initiatives include expanding the electricity transmission grid, constructing new substations, upgrading existing facilities, and installing underground power lines.

Fekadu emphasized that the project will also play a critical role in securing a reliable, modern electricity supply for the 32nd Conference of the Parties to the UN Framework Convention on Climate Change (COP32), which Ethiopia is scheduled to host in 2027.

According to the Chief Whip, the loan offers highly favorable concessional terms, including a six-year grace period and a 31-year repayment term, minimizing the financial burden on the government.

 

He added that the financing aligns with Ethiopia’s broader national debt management strategy while fostering sustainable economic growth through a strengthened power grid.

Following deliberations, the House unanimously approved the draft proclamation, officially ratifying the additional 145.8 million USD agreement as Proclamation No. 1441/2026.