The African Development Bank (AfDB) on Thursday approved a $ 348 million loan that will help Ethiopia to speed up a $1.2 billion project to supply Kenya with electricity.
Ethiopia hopes to start supplying its neighbour with electricity in the next three to four years following a massive investment.
The AfDB said Ethiopia would receive $232 million of the funding, while Kenya would take $116 million.
The World Bank approved the first phase of the funding in July, totaling $684 million.
Construction of the 1,068 km high-voltage transmission line would be co-funded by the World Bank, French Development Agency and the Ethiopian and Kenyan governments.
Meanwhile, Ethiopia hopes to complete the construction of a 210 million euro wind power project, financed by the French government, by next March.
The Ashegoda Wind Power project, in Tigray State, has a generating capacity of 120 MW of electricity.
The project is part of Ethiopia's investment in the energy sector, as it hopes to become Africa's main power producer and supply other countries on the continent.
The wind power project should be fully operational next March, the Ethiopian Electric and Power Corporation (EEPCo) said.
The Ashegoda Wind Power project, situated 28 km away from Mekelle, a Tigray regional town in the Northern part of Ethiopia, is currently running at a 90 MW capacity ahead of the completion.
The project is financed by the French bank BNP Paribas through soft loan amounting to 210 million euros, facilitated by the Agence France de Development.
Ethiopia is currently undertaking multi-billion dollar power investment projects, and is building Africa's biggest dam over the Nile River with an investment of around $5 billion.
The dam, to produce about 6,000 MW of power, is expected to start generating power in the next two years and will be completed three years later.
The Horn of Africa country has already started exporting power to Djibouti, while a test run of power supply to Sudan was carried out last month.
Kenya and South Sudan also hope to import power from Ethiopia.