Wandayi on Friday, October 11 remarked that the deal is a game changer given that it marks a huge shift in the power transmission across the country.
Energy and Petroleum Cabinet Secretary James Opiyo Wandayi has announced that Kenya Electricity Transmission Company Limited (KETRACO) and Adani Foundation Energy Ltd have inked a Ksh95.7 billion agreement to operate, and maintain transmission lines and substations for 30 years in a bid to curb power blackouts.
Wandayi on Friday, October 11 remarked that the deal is a game changer given that it marks a huge shift in the power transmission across the country.
“I am pleased to announce the successful signing of the Project Agreement between the Kenya Electricity Transmission Company Limited (KETRACO) and Adani Energy Solutions Limited today (the Project Company). This agreement marks the beginning of a transformative initiative to develop, finance, construct, operate, and maintain key transmission lines and substations across Kenya,” he revealed in a statement.
The contract, finalised on October 9, 2024, comes after four months of intense negotiations, during which the Adani Group faced scrutiny regarding its operational practices.
A collage of Adani Group CEO Gautam Adani and the logo of his company. /INDIA TODAY
Despite concerns surrounding the Adani Group, which has been embroiled in various controversies, Wandayi has defended the partnership, highlighting the critical need for enhanced electricity infrastructure to support Kenya’s burgeoning economy.
“All Kenyans are well aware of the significant challenge that our country faces with persistent power blackouts. These projects are designed to significantly enhance our national electricity infrastructure (transmission lines and substations), ensuring reliable and widespread access to power that will support Kenya’s growing economy and development goals,” he continued.
Wandayi announced that as part of this infrastructure development, the Project Company will raise all the funding in the form of debt and equity that will be repaid over the 30-year period of the project agreement.
The project cost, which is currently estimated at Ksh95.68 Billion (USD 736 million) will be crystallised through a competitive bidding process, that will be jointly handled by KETRACO and the Project Company, thus ensuring significant value for money for the country.
The CS assured that the competitive bidding process will prioritise local content and ensure that the government prioritises business opportunities for Kenyans.
“It is important to note that the Government of Kenya will not incur any financial expenditure for this project. The country will benefit from world-class energy infrastructure ensuring value for money, further demonstrating the government’s commitment to prudent fiscal management,” he went on.
“Adani Energy Solutions will manage the transmission line for 30 years, ensuring long-term sustainability and efficiency, and thereafter transfer the project and all its assets to KETRACO.”
Before signing the agreement, KETRACO conducted comprehensive due diligence on Adani Energy Solutions as the project proponent, along with thorough stakeholder engagement. This ensures that all concerns have been addressed and the project is primed for successful execution.
Deal Particulars
The deal involves the construction of three high-voltage power transmission lines and two substations, strategically located to enhance connectivity and stability in the national grid. They include:
- 400kV (Double-Circuit) Gilgil-Thika-Malaa-Konza Line: Spanning 208.73 km
- 220kV Rangai-Kenegut-Chemosit Line: Covering 99.98 km
- 132kV Menengai-Ol Kalou-Rumuruti Line: Extending 89.88 km
Additionally, critical substations will be developed at various locations, including Lessos and Thura Buru, to support the 400kV transmission network and expand local distribution grids.
The project aligns with Kenya’s Vision 2030 development plan and the Bottom-Up Economic Transformation Agenda. It aims to:
- Expand access to electricity across the country
- Create job opportunities
- Stimulate economic activity in grassroots communities
- Support industrial growth and improve power reliability
Wandayi emphasized the government’s commitment to supporting the timely implementation of such transformative projects. The initiative is expected to not only bolster energy infrastructure but also contribute significantly to the economic and social transformation of Kenya.
Kenya Power technicians at work on a transformer. /THE STAR