Sustainability challenges of hydropower and its implication on Ethiopia’s economy

Ethiopia has the potential to be 100% renewable. Its renewables are capable to solve its energy poverty and energy shortage in East Africa. The country’s climate resilient green economy strategy considers energy as key enabler for vibrant economy. The objective of this paper is to identify key challenges of the energy sector by studying 12 years of electricity generation data, 2012 to 2023, and to analyze the sector’s performance with a special emphasis on hydropower. In this study, both quantitative and qualitative methods were employed to draw performances indicators. The quantitative results showed that the country achieved 30% of its energy development plan with a deteriorating performance from 94% to 40%. This performance works for hydropower too, which dominants the electricity development and supply. The declining performance comes from government’s monopoly in the sector, financial deficit due to ongoing internal crises and technical unavailability of power plants. This performance has greatly influenced expansion of industries, access to electricity, unemployment, and other economic activities. The authors advise the government, stakeholders, and development partners to consider the recommendations given in this paper to boost the energy sector development and keep the country in healthy economic pace by all measures.