Interview

How does Djibouti’s energy and natural resources policy support its economic development?

GUEDI: Djibouti’s energy policy strongly promotes foreign direct investment, mainly through a modernised legal and institutional framework. This framework not only aims to foster a liberalised energy sector, but also facilitates the goal to become the first African nation to attain 100% renewable energy consumption, therefore eliminating fossil fuel sources from electricity generation.

Moreover, policymakers are implementing various measures to safeguard the country’s energy security. For instance, the government is strengthening its legislative and strategic energy framework to boost rural electrification. Any successful economic model cannot be implemented nationally without the participation of all the cities and regions, so it is important to enhance collaboration between all levels of government, as well as consult businesses and the population about their energy needs.

In terms of natural resources, Djibouti remains largely unexplored. Because of this, the Directorate of Natural Resources and the UN Development Programme have created an inventory of the country’s mineral resources. This project should allow Djibouti to quantify its mining potential for the first time, which would also allow the government to justify a greater allocation of resources to the training of local personnel in order to negotiate with foreign businesspeople and investors.

How can geothermal energy be further developed to diversify the energy portfolio?

GUEDI: Djibouti has been harnessing the power of its geothermal resources for nearly 50 years. However, it was not until the 2013 creation of the Djibouti Geothermal Energy Development Authority that the government provided a framework to encourage this development. The newly created school of excellence aims to boost human capital capacity in the private and public spheres to support the country’s future market needs. As neighbouring Kenya is a global pioneer in geothermal exploitation, we are also building strong bilateral relations with their government to develop a strategy and provide technical training for 80 Djiboutians.

With the recent launch of geothermal drilling programmes in Djibouti – specifically in Fialé – exploiting this potential will soon yield returns. This exploration is enhanced by the involvement of multiple stakeholders, both technical and financial. The World Bank, the African Development Bank, the French Development Agency and many others actively participate in the transition to clean energy. Given the amount of financing that goes into all phases of geothermal development, international involvement is vital to the industry’s success.

What policy has been implemented to accelerate Djibouti’s transition to renewable energy?

GUEDI: Djibouti has significant potential in renewables, and we must prioritise investment in this to ensure our economic growth is environmentally sustainable. Prioritising geothermal, wind and solar energy over fossil fuels will allow us to provide low-cost electricity for households and businesses. Moreover, Djibouti has a natural geothermal capacity of between 600 and 1000 MW, as well as substantial wind potential thanks to relatively high wind speeds of 10-14 metres per second.

However, solar offers the most promising opportunities for development, as Djibouti’s sunny climate allows it to produce 2430 KWh per sq metre per year. In order to help capitalise on these favourable circumstances, in 2015 the authorities passed the Independent Electricity Producers Act to create more attractive conditions for companies and also permit foreign investors to participate in the market.