Ethiopia has seen an increase in power concerns stemming from crypto mining activities amid the boom in the country’s cryptocurrency industry. The domestic crypto mining and data center industry is expected to consume a third of the country’s electricity supply in 2025, according to the report.
The forecast has raised issues with energy allocation in countries where half of the population still lacks access to reliable electricity supplies.
According to the newly released Ethiopia Energy Outlook 2025, electricity demand from cryptographic data centres will exceed 8 terawatt hours (TWH) this year. This represents about 30% of nationwide demand. The report was prepared by state-owned enterprises and the national Petroleum Energy Agency, and question whether such use is appropriate.
Ethiopia’s energy outlook in the 2025 report raises concerns
Crypto mining operations are seen as a means of forex and digital infrastructure, but the large energy footprint they generate has sparked debates over equity and efficiency. Additionally, despite numerous targets and large-scale infrastructure programs in place in the country, Ethiopia’s electric shock progress is slowing.
“The balance between supply and demand remains an open question as to whether diesel generators can better use electricity for exports, general electrification, or other productive applications, such as pumping water in the widespread use of water and agricultural sector,” it reads.
According to the report, the National Electrification Program (NEF) has connected about 2.2 million households to the grid over the past five years, leading up to 2024, but even so, nearly 50% of the population has no access to reliable electricity, and only 22% have grid connections, a legal meter.
The report also warns that the slow expansion of electricity access is one of the factors that hinder economic development and reduces the potential benefits of other sector reforms. ” To address this issue, we need to expand energy access to regions that are not blessed with increasing infrastructure investment and increased innovative solutions. The respective tariff and exchange rate reforms are expected to alleviate the shortage of materials for electrification, one of the major barriers to its progress,” the report states.
The current distribution covers only 25% of the land area in Ethiopia, but about 68% of the population is less than 5 km from the grid. “This underscores the possibility of tripling the number of household connections within the footprint of an existing grid. Implementing cost-reflective tariffs will provide the EEU with new connection resources, making broader electrification more feasible,” reads Outlook.
Critics urge governments to consider essential services
The report also said Addis Ababa enjoys an electrification speed of around 93%, while regions such as Afar and Somali remain below 12%. There was also a talk that under the new cost reflective pricing regime based on NEP 3.0, electricity tariffs will be increased by up to 400% by 2028.
Analysts hope that price increases will reduce crypto mining activities. This currently benefits from sub-market electricity rates and tax regulations.
Crypto Mining offers direct foreign investment opportunities and uses 98% of Ethiopia’s renewable energy, but critics argue that the expansion during the country’s electrification crisis could affect wider development goals. According to the report, around 15 million households are still waiting for their first grid connection.
Ethiopia has shifted to accept Bitcoin mining after the National Bank of Ethiopia (NBE) banned crypto trading in 2022. The following year, the government began quietly registering mining through cybersecurity agency INSA, signaling a move towards monetizing digital infrastructure.
Critics say that countries struggling to provide reliable electricity and clinics to farmers and farmers who rely on diesel pumps for irrigation should reevaluate their energy allocations. They also urged policymakers to consider the trade-off between digital infrastructure growth and essential services.