US-Icelandic geothermal development company, Reykjavik Geothermal (RG), has agreed to build a $4 billion 1000MW geothermal plant in Ethiopia which will be Africa’s largest, as part of the President Barack Obama $7 billion Power Africa initiative which seeks to increase electricity supply on the continent.

The planned Corbetti Caldera-based plant will be built in two 500MW phases over a duration of 8 years to 10 years. The first 200MW of power is expected to be online by 2016 with an additional 300MW in operation by 2018.

The Ethiopian Prime Minister, Hailemariam Desalegn, while commenting on the impact of the project said the “1000MW with RG is not that large, but it’s a great start.”

Desalegn plans to make Ethiopia a regional energy hub adding that public private partnership with increased investment would be needed to achieve the goal.

“My vision is that over the next 30 years, we will need to harness as much as 80,000MW of hydro geothermal, wind and solar power, not just for Ethiopia, but for our neighbouring countries as well,” the Prime Minister said.

He furthered: “This cannot be done by public investment alone. We will need to partner with the private sector.”