The African Development Bank (AfDB) and the United Kingdom (UK) have announced the selection of Kenya’s $116mn Transmission Network Improvement Project as a beneficiary project under the Room to Run Sovereign transaction (R2RS).
- In Sept 2023, Kenya announced it had received financing from AfDB and Korean Exim Bank towards the project.
- The two institutions will provide 96% of the total cost, while the government of Kenya will provide the $5million balance.
- The two-year old R2RS enables the AfDB to provide up to an additional $2 billion of climate finance to Africa by 2027, split between adaptation and mitigation.
“Kenya is close to achieving universal electricity access with a high component of renewable energy,” Nnenna Nwabufo, African Development Bank Director General for East Africa said.
The two main components of the project, which falls under the Kenya Electricity Transmission Company (KETRACO) are construction of 73kms of 220kV and 199kms of 132kV transmission lines, and the construction and upgrading of 7 substations.
The AfDB estimates that the improved transmission lines will reduce annual CO2 emissions by 1,258 tCO2.
- The project is scheduled to run from Jan 2024 to Dec 2028.
- On Jan 16th, KETRACO sent out a call for consulting firms to carry out initial designs, bid preparation and review, and detailed design evaluation.
- Among other upgrades, the project will upgrade the 132kV Rabai Bamburi Kilifi line which is currently built on timber poles, to a new double circuit, to stem power losses and stability challenges.
The Bigger Picture
In May 2023, the UK and the AfDB announced the first two projects that were enabled by R2RS – an €80 million Egyptian wastewater project and a €37 million water sanitation project in Senegal.
- In addition to the Kenya project, the UK will also back three other projects on the continent.
- They are: the Secondary Town Stormwater Drainage Project (Benin), Gas Insulated Switchgrar Substation Project (Mauritius), and the Inclusive and Sustainable Development of the Cereal Sector Project (Tunisia).
- This brings the total financing unlocked by the R2RS to over $400 million.
“We’re working together with the AfDB and Kenya to deliver what Kenyans want and need: reliable power for reliable economic growth – all with green energy that protects the prospects of future generations.” Neil Wigan OBE, High Commissioner to Kenya said.
The AfDB and Kenya are also shareholders in Africa50, a continental infrastructure investment platform that is developing two privately-owned transmission lines in a project worth $298mn in Kenya.
The project, which is designed as a public-private partnership pilot project, will see the construction of the 400kV, 165km Loosuk-Lessos line (Samburu), and the 220kV, 72km Kisumu-Musaga line. The project includes the Power Grid Corporation of India Limited as a technical and minority equity partner.
- Other ongoing projects include the 103km 400kV Nairobi Ring Project, funded by the government of Kenya, the European Investment Bank, and Agence Francaise de Développement (AFD).
- There’s also the 96km 400kV double circuit line from Isinya to Namanga, which will serve as a Kenya-Tanzania interconnected, funded by the AfDB and the Kenyan government.
- Another project financed by the two is the 68km 132kV OlKaria-Narok line, which includes extension of the OlKaria substation and the construction of a new substation in Narok.
