Access to electricity is a fundamental driver of economic growth and poverty reduction. Without it, businesses cannot run, schools cannot provide quality education and healthcare facilities struggle to operate effectively. In Eritrea, where nearly half of the population lives in poverty, access to electricity remains a significant challenge. Only 53% of the population has access to electricity, 76% in urban areas and only 10% in rural regions. This limited access hinders economic opportunities; however, a recent push toward renewable energy, particularly solar power, offers hope for a brighter future. As Eritrea experiences steady GDP growth and declining poverty rates, renewable energy in Eritrea has the potential to accelerate this progress by expanding electricity access sustainably and cost-effectively.

The Role of Electricity in Economic Development

The World Bank identifies inclusive economic growth as the most effective means of reducing poverty. However, sustainable development is impossible without adequate, reliable and competitively priced modern energy. In Eritrea, where heavy reliance on imported oil has historically shaped the energy sector, the transition to renewable energy is not just about environmental sustainability–it is an economic necessity. By reducing dependence on expensive and volatile fossil fuel imports, Eritrea may be able to stabilize its economy and allocate resources more efficiently. 

Solar Power: A Sustainable Solution

Eritrea is investing in renewable solutions to address this energy gap, including constructing a 30 MW Solar Photovoltaic Power Plant in Dekemhare funded by the African Development Bank. The plant will create both short-term and long-term jobs, but its secondary benefits are transformative. Increasing national energy capacity from 35 MW to 65 MW–closer to the 70 MW peak demand–will reduce power shortages and load shedding, ensuring more consistent access to electricity. This additional power is crucial for small businesses, agricultural operations and educational institutions. More stable energy access means businesses can extend working hours, farmers can use solar-powered irrigation systems, and schools can introduce digital learning tools.

Addressing Agricultural Challenges

Agriculture is the backbone of Eritrea’s economy, with more than 75% of the population relying on it for their livelihoods. However, limited electricity access restricts agricultural practices such as irrigation. Conventional pumps for irrigation require diesel, but low domestic oil production, decreased imports and high fuel prices have made it increasingly difficult for farmers to maintain operations. With a peak energy demand of 70 MW and only 35 MW of operational capacity, power shortages further exacerbate poverty and food insecurity. The introduction of solar power can significantly improve irrigation systems across the country and enhance overall agricultural productivity. By investing in renewable energy, Eritrea can strengthen food security while simultaneously driving economic growth.

A Path Forward

The transition to renewable energy is not just about meeting electricity demand–it is about transforming lives. With Eritrea’s GDP projected to reach $10.1 billion by 2043 and extreme poverty expected to decline to 13%, Eritrea stands at a pivotal moment where renewable energy can accelerate progress. By reducing reliance on fossil fuels and expanding electricity access, the country can unlock new economic opportunities, improve living standards and pave the way for sustainable development. 

As the push toward renewable energy in Eritrea continues, the benefits will extend far beyond electricity. They will reshape communities, empower businesses and create a more prosperous future for all.

– Linnéa Matlack

Linnéa is based in Boston, MA, USA and focuses on Good News, and Technology for The Borgen Project.

Photo: Pixabay