ADDIS ABABA (Reuters) - Ethiopia opened a dam on Friday that it says will produce 460 megawatts (MW) of hydropower as part of efforts to overcome chronic energy shortages and become a power exporter, state media said.
Power shortages are common in Africa and have hindered investment, even though the continent has abundant potential resources of solar, hydro, oil, gas, coal and geothermal power.
The Beles Dam has started producing 115 MW and that will rise to 460 MW within two months, the state-run Ethiopian News Agency reported.
Power outages have been common in Ethiopia for five years. The utility says economic growth has caused a surge in demand for power and it is working to catch up.
Ethiopia rationed power for five months in 2009 with outages every second day, which closed factories, hampered exports and fuelled a currency shortage.
The country's utility, EEPCo, started cutting power again in February after a tunnel collapse stopped production at Ethiopia's biggest hydropower dam.
Businessmen in Addis Ababa told Reuters then that factory owners inside and outside the capital -- including exporters -- had been asked by EEPCo to halve their power consumption until the tunnel was repaired.
The utility is building four more hydropower dams, including the huge 1.4 billion euro Gibe III that it says will generate 1,800 MW, doubling current capacity of just under 2,000 MW.
Foreign charities say Gibe III could cause 200,000 local people who rely on fishing and farming to go hungry.
The government denies that.
Hydropower fuels about 90 percent of Ethiopia's energy, EEPCo says.
Energy Minister Alemayehu Tegenu told Reuters in November that Ethiopia would produce 15,000 MW of power within 10 years and planned to export to neighbouring countries including Kenya, Sudan and Djibouti.