ADDIS ABABA, May 24 (Xinhua) -- Ethiopia signed a 201 million U.S. dollars loan agreement with Denmark on Thursday to finance a 100 MW wind energy project in central Ethiopia.

The loan agreement was signed in Ethiopia's capital between Mette Thygesen, Ambassador of Denmark to Ethiopia and Admasu Nebebe, Deputy Minister, Ethiopia Ministry of Finance and Economic Cooperation (MoFEC) in the Ethiopian capital Addis Ababa.

In a press statement, MoFEC said the 201 million U.S. dollars loan agreement will see Danish government give financial support to Ethiopia through its official development cooperation Agency, Danish International Development Agency (DANIDA) to finance the 100 MW Assela wind farm project.

Ethiopia currently has three operational wind farm projects -- the 120 MW Ashegoda wind farm in Northern Ethiopia, the 51 MW Adama I and 153 MW Adama II wind farms both in central Ethiopia.

China's Dongfang Electric Corporation is also preparing to construct a 120 MW wind farm project in Ethiopia's eastern Somali regional state.

The Ethiopian government plans to increase its electricity generation capacity from the current 4,200 MW to about 17,300 MW by 2020 using hydro, wind, geothermal, biomass and solar energy.