Ethiopian Electric Power Introduces New Electricity Tariff Structure for Data Mining Operations
Addis Ababa, Ethiopia – October 27, 2025
Ethiopian Electric Power (EEP) has formally announced a revised electricity tariff framework for data mining customers, marking a strategic adjustment designed to align the energy sector with Ethiopia’s national cost recovery objectives and the evolving energy demands of the digital economy. The new structure will take effect on December 1, 2025, and remain in force for a three-year implementation period through July 2028.
1. Context and Policy Objective
EEP’s revision follows an extensive assessment of power generation, transmission, and operational costs. The new tariff aligns with Ethiopia’s national cost recovery framework, ensuring financial sustainability of the grid while maintaining service reliability for high-energy industrial users, particularly crypto and data mining operators.
The initiative underscores Ethiopia’s policy of attracting responsible digital investment while safeguarding the national power supply balance. EEP reiterated its commitment to delivering reliable, secure, and clean electric power and emphasized that this adjustment is a necessary measure to sustain efficiency in an increasingly energy-intensive environment.
2. Introduction of Time-of-Use (TOU) Tariff
The core feature of the revised structure is the Time-of-Use (TOU) tariff system, which introduces differential rates based on grid loading and time of consumption. Under this model, electricity charges will vary across three daily periods:
| Period | Time Range | TOU Tariff (US¢/kWh) | Implementation 2025–2028 |
|---|---|---|---|
| Peak | 18:00 – 22:00 | 6.0 → 7.2 | Gradual increase over 3 years |
| Shoulder | 05:00 – 09:00 | 4.5 → 6.45 | Moderate increase |
| Off-Peak | 23:00–05:00 & 09:00–18:00 | 3.5 → 6.35 | Incentivized period for usage |
These rates include 15% VAT and a 0.5% regulatory fee. Customers will therefore be billed in accordance with the grid’s operational dynamics—promoting efficient energy use during lower-demand hours.
EEP noted that the TOU system aligns Ethiopia’s pricing policy with global best practices for large-scale industrial and digital electricity consumers, balancing grid stability with economic competitiveness.
3. Introduction of the Availability-Based Tariff (ABT)
In parallel, EEP is launching an Availability-Based Tariff (ABT), a performance-linked pricing mechanism designed to promote fairness and transparency. The ABT adjusts the applicable energy rate based on actual power availability, rewarding customers for efficient operations during periods of reduced hydropower generation or planned load management.
Under this mechanism, the energy charge is automatically modified in proportion to national power availability, categorized as follows:
EEP clarified that these adjustments are linked to real-time system performance and water resource management outcomes, ensuring equitable cost recovery while encouraging customers to optimize consumption during constrained supply conditions.
4. Implementation and Transition Period
The revised tariff will be rolled out in three phases:
| Availability Range | Description | Adjusted Tariff (US¢/kWh) |
|---|---|---|
| 100–70% | High | No adjustment or minor (4.19–5.14) |
| 69–60% | Moderate | 3.24–5.07 |
| 59–50% | Medium | 3.18–4.98 |
| <50% | Low | 3.09–4.86 |
Each phase includes corresponding TOU differentiation to gradually align customer billing with the actual cost of power delivery and grid balancing requirements.
EEP has affirmed that these revisions comply with the Power Purchase Agreement (PPA) provisions—specifically Article 1.1 and Schedule B—which allow for tariff adjustments in line with approved system cost variations.
5. Strategic Implications for Investors and Operators
The revision carries significant implications for Ethiopia’s emerging data mining and blockchain sector, which has grown in prominence due to the country’s low-cost hydropower potential.
While the new tariff introduces higher rates compared to previous years, it remains regionally competitive and is structured to reward energy-efficient and time-sensitive operations.
For operators, the adoption of energy scheduling technologies and load optimization systems will become critical for maintaining profitability. Investors are encouraged to integrate peak-shaving strategies, renewable supplementation, and demand forecasting tools to adapt to the TOU model effectively.
6. Outlook and Conclusion
This tariff revision represents a strategic modernization of Ethiopia’s electricity pricing model, balancing industrial growth with national energy sustainability.
By integrating time-based and availability-based billing, EEP is positioning itself to better manage hydropower variability, enhance transparency, and ensure reliable service to priority sectors such as data centers, manufacturing, and digital infrastructure.
The move reinforces Ethiopia’s trajectory toward becoming a regulated yet innovation-friendly digital investment destination, capable of supporting both local and foreign enterprises in the evolving energy and technology landscape.