Ethiopia has the ambition to develop its economy to make it more resilient to the impacts of climate change and pursue low carbon development. The Government of Ethiopia has adopted the Growth and Transformation Plan (GTP), which outlines the country’s strategy to reach middle-‐income status before 2025. At the same time, the Government has issued the Climate-‐Resilient Green Economy (CRGE) strategy in 2011, which lays down the country’s plan for a carbon neutral, green economy by 2025. Combining rapid economic growth while containing the environmental impact is a challenge that Ethiopia aims to realise through international partnerships, targeting both financial cooperation and capacity building.
If Ethiopia were to pursue a conventional economic development path to achieve its ambitious development targets, the resulting negative environmental impacts would follow the fatal patterns observed all around the globe. Under current practices, greenhouse gas (GHG) emissions would more than double from 150 Mt CO2e in 2010 to 400 Mt CO2e in 2030.
The CRGE strategy describes a number of ‘abatement levers’ to drive the transition to a green economy. Transport has been identified as a key sector with a significant GHG abatement potential and vast sustainable development benefits.
More specifically, construction of the Light Rail Transit (LRT) system in Addis Ababa and a modal shift of freight transport from road to an electric rail network powered through renewable energy (electricity in Ethiopia is almost entirely renewable, generated by hydropower, geothermal and wind power) are listed as the most beneficial interventions.1 A modal shift from road to rail will be a key pillar to transform Ethiopia’s economy to a middle income country, as affordable integration to its neighbouring countries will be achieved.
This is key for a landlocked country like Ethiopia to achieve its export targets and to access lower cost imports.
Baseline scenario
While emissions from the transport sector currently only contribute
3% to Ethiopia's GHG emissions, they are expected to increase by 7-‐ fold from around 5 Mt CO2e in 2010 to 40 Mt CO2e in 2030 when following a BAU scenario. Currently ~75% of the emissions come from road transport, particularly freight and construction vehicles, and to a lesser extent private passenger vehicles. Air transport also contributes a significant share (23% of transport-‐related emissions).
An annual growth rate ranging from 12.4%-‐ 13.7% in tonne-‐km of
freight transported is estimated to create a baseline scenario up to
2030. This estimate was calculated using the elasticity of diesel imports to real GDP based on National Bank of Ethiopia’s statistics and GDP growth rates as projected by the GTP and by EDRI/MOFED.
Passenger road transport emissions are driven by an old and inefficient fleet composed of 240,000 vehicles, with an average age of 15 years. The passenger fleet consumed 0.6 billion litres of imported fossil fuel in 2010. The increase in road passenger-‐km travelled was forecast at an annual growth rate of 8.3%-‐9.1%. This estimate was calculated using the elasticity of passenger-‐km to real GDP based on the Ministry of Transport’s statistics for the past ten years and GDP growth rates as projected by the GTP and by EDRI/ MOFED.
NAMA scenario
Avoidance of emission can be achieved through modal shift of freight and passenger transport from road to rail.
The Ethiopian Railways Corporation (ERC) was therefore set up in
2007 with the mandate to construct railway infrastructure and provide passenger and freight trail transport services in Ethiopia. The envisaged infrastructure consists of two railway project components, namely the Addis Ababa Light Rail Transit (LRT) and the National Railway Network (NRN)
The first phase of the LRT project is planned to be 35 km long, its construction started in 2012 and is planned to be finalized in the beginning of the year 2015. The second phase of the LRT will be an extension of the first line of ~ 54.91 km, leading to a total length of
89 km.
The NRN, on its part, consists of eight corridors of varying lengths in diversified strategic routes that will be realised in two phases, covering over 5,000 km in distance.
Route 1: Addis Ababa-‐Modjo-‐Awash-‐Dire Dawa-‐Dewanl (656 km)
Route 2: Modjo-‐Shashemene-‐Arbaminch-‐Konso-‐Moyale Including Shashemene-‐Hawasa and Konso-‐Weyto (905 km)
Route 3: Addis Ababa-‐Ijaji-‐Jimma-‐Guraferda-‐Dima including Jimma-‐ Bedele (direct to Boma with further extension to south Sudan) (740 km)
Route 4: Ijaji-‐Nekemet-‐Assosa-‐Kumruk (460 km)
Route 5: Awash-‐Kombolcha-‐Mekele-‐Shire (757 km)
Route 6: Fenoteselam-‐Bahirdar-‐Wereta-‐Weldia-‐Semera-‐Elidar (734 km)
Route 7:Wereta-‐Azezo-‐metema (244 km),
Route 8: Adama-‐indeto-‐Gasera (248 km).
The initial financing of the three railway routes and the Addis Ababa LRT has been successfully secured. The operation of the routes will however see an exploitation shortfall due to debt financing repayments.
For the already financed route, large scale climate finance is targeted to be used to re-‐finance while for new lines, climate finance is envisioned to be incorporated in the initial financing model. In the absence of large-‐scale climate finance targeting infrastructure financing, ERC focuses on utilizing climate finance to finance activities supporting the sustainable operation of its railway.