State seeks Sh69bn to connect more Kenyans to power grid

Growing the number of connections to 75 per cent of the population would mean more than doubling the current number of Kenya Power customers to about six million over the next five years. [PHOTO: FILE/STANDARD]

By MACHARIA KAMAU

NAIROBI, KENYA: The Energy ministry is planning to borrow $800 million (Sh69 billion) over the next five years to finance power connectivity infrastructure.

The money will be spent to increase the number of people with access to electricity.

Principal Secretary Joseph Njoroge said the ministry is currently in talks with different financiers – mostly development finance institutions – for concessionary loans of up to $800 million.

The money will mostly be used in putting up what he termed as last mile power connections, especially in farflung areas without easy access to the national electricity grid.

He added that the ministry and the agencies that will implement the connectivity projects have already secured a substantial amount of money and are set to start implementing some of the projects towards the end of this year.

Eng Njoroge said the ministry had already received a $160 million (Sh13.7 billion) facility that would be released by September this year.

“We are expecting the first batch of the very long-term loans of $160 million to be approved by September,” he said while opening a forum for energy industry regulators from across Africa in Nairobi Tuesday.

“We plan to use the $800 million over the next four to five years to undertake the last mile connections which will increase the number of people with access to electricity from the current 32 per cent to 75 per cent of the population,” he explained.

UTILITY REGULATORS

The African Forum for Utility Regulators, a three-day conference hosted by the Energy Regulatory Commission, has brought together energy industry regulators from across the continent.

According to official records, Kenya Power had 2.3 million customers as of June last year.

Growing the number of connections to 75 per cent of the population would mean more than doubling the current number of Kenya Power customers to about six million customers over the next five years.

The power infrastructure projects will be implemented by the Rural Electrification Authority – which has the mandate of growing connections to the national electricity grid in rural Kenya – and Kenya Electricity Transmission Company (Ketraco).

REGULATORY BODIES

 Ketraco is charged with putting up high voltage long-distance power transmission lines.

Conference participants heard that highly professional regulatory bodies were more likely to attract foreign direct investments from multinational companies in the energy industry.

“Studies have found that developing countries with high quality regulatory bodies have a high chance of attracting investment on a sustained basis into their utility service industries,” said Patrick Mabuza of the National Energy Regulator of South Africa (NERSA).