Vergnet was selected following an international tender call by state utility Ethiopian Electric Power Corporation (EEPCo). According to EEPCo, Vergnet offered lower project costs than rival bidder Syno-Hydro, a Chinese construction firm, and had also solicited funding from French banks. Most of the funding will come from a syndicated loan of EUR 165 million granted by French bank BNP Paribas and guaranteed up to EUR 130 million by Coface, a French government agency providing export guarantees. French development agency AFD has agreed to lend a further EUR 45 million.
Vergnet's just launched GEV HP 1 MW turbine (Windpower Monthly, September 2008) is described as being ideally suited to the site, which is in difficult terrain in the northern highlands, 2400 metres above sea level. The deal includes training EEPCo engineers and a two-year operation and maintenance contract. The first 30 turbines are to be delivered in early 2009 and the rest rolled out in phases over the next three years.
Ethiopia is keen to increase its generating capacity, reduce oil imports and diversify away from hydro, which powers over 95% of the country's electricity supply. Recent droughts coupled with rising demand mean an ever-widening deficit. The government is also keen to increase access to electricity from its current low base of around 15% of the population.
The search for suitable sites for wind power production started in 2004, with the assistance of the German Development Corporation (GTZ), which advised on site selection, measurement and evaluation of wind data and helped with feasibility studies and tendering procedures. The Austrian Development Agency provided training for EEPCo employees. GTZ found the best wind resource in the east and north of the country, with average wind speeds of over 8 m/s, load hours of over 2700 hours a year and a capacity factor of 31-37%. Furthermore, the wind blows at its strongest at the end of the dry season when the reservoirs are at their lowest.