US trade agency in pact to fund Kenya’s power projects

The US Government on Thursday increased the level of funding to Kenya’s energy sector following agreements signed with two power producers.

Through its US Trade and Development Agency (USTDA), the American Government advanced Sh160 million to KenGen and Xago Africa, which are expected to use the money in developing their electricity generation projects in geothermal and solar respectively.

Last year, USTDA financed different power projects in Kenya through grants of more than $4.86 million (Sh400 million), most of which are in their inception stages.

Existing plants

Part of the funds by USTDA were advanced from Power Africa, the American initiative to increase access to electricity in Africa. KenGen, which received $500,000 (Sh50 million), said it plans to increase the amount of electricity generated by already existing geothermal plants at its Olkaria fields through maximising the potential of steam from the wells. “We will use the funds for research and development, particularly looking at how we can extract more energy from geothermal steam and water,” said the power generating firm’s Chief Executive Albert Mugo in Nairobi yesterday.

Xago Energy said the money will partly finance the development of a $75 million (Sh7.5 billion) solar power plant that it is developing in Siaya County.

The plant is expected to have a 40 megawatts capacity and is scheduled for completion towards the end of next year.

“Construction of the plant is expected to start in early 2018 and be completed in the fourth quarter of the same year,” said Xago Africa Managing Director Paul Webb.

“It will be among the first in Africa to have battery storage for power produced when there is sun."