Uncertainty as Power Africa moves offices

There is fear that Kenya may lose out in major power projects and associated benefits following a decision to move United States’ backed multi-billion shillings Power Africa initiative headquarters from Nairobi to South Africa.

People familiar with the matter said the African coordinator who was based at the US Embassy offices in Nairobi has relocated to South Africa for the last two months leaving only a skeleton staff who do not know if they still have jobs or not. The few staff at the Nairobi offices are now reporting to South African offices.

This has in effect stalled a number of discussions with most consultants who were angling to provide various services under the ambitious Sh609 billion ($7 billion) project launched by President Barack Obama a year ago. It is said the funding has been increased to Sh2.2 trillion ($26 billion) as a result of last week’s US-Africa summit.

The project targets six countries including Kenya, Tanzania, Ghana, Liberia, Nigeria and Ethiopia initially. Power Africa will also partner with Uganda and Mozambique on responsible oil and gas resources management. Power Africa has an ambitious goal of adding more than 10,000 megawatts (MW) of cleaner, more efficient energy generation capacity in sub-Saharan Africa.

This increased capacity will make it possible to provide electricity access to 20 million new households and commercial entities in sub-Saharan Africa with on-grid, small-scale, and off-grid solutions. Industry players are now silently hoping that last week’s tour of President Uhuru Kenyatta to the US will help to soften the decision so that the country is able to actively participate in the project.

“It is in the interest of the country that the operations are held here,” said a source familiar with the matter, adding that Kenya is going to lose in terms of decision making and project capacity building. Some critics have also questioned the speed of implementation of the ambitious project saying that Kenya is yet to feel any impact so far.

However, according to Power Africa’s 2014 annual report released by USAid last month, the project is progressing well. The report says as of June 2014, Power Africa had helped facilitate the financial close of transactions which expect to produce nearly 2,800 MW of new generation capacity, more than 25 per cent of the 10,000 MW goal.