Kenya-Ethiopia power import deal enters new phase with tender call

PHOTO | FILE President Kibaki and Ethiopian Prime Minister Hailemariam Desalegn during the signing of a special status agreement at State House in Nairobi, in November 2012. The Kenya-Ethiopia interconnector will have a capacity of 2,000 megawatts.

What you need to know:

  • Ethiopia is currently constructing the Grand Ethiopian Renaissance Dam, expected to generate 6,000 megawatts, partly for export to the region, and is scheduled to be completed in 2018
  • The Kenya-Ethiopia interconnector will have a capacity of 2,000 megawatts, although in a deal signed last year by Kenya’s Energy ministry and the Government of Ethiopia, the country intends to import an initial 400 megawatts of electricity
  • In September, the board of AfDB approved a $348 million loan to fund the project, adding to another $684 million loan that had been approved by the World Bank’s board of directors towards the same course

The push to import electricity from Ethiopia has entered a new phase, with a call for tenders to set up substations linking Kenya and Ethiopia.

The Kenya Electricity Transmission Company Ltd (Ketraco), a State corporation set up to develop electricity transmission infrastructure, on Monday advertised tenders for contractors to install substations in Suswa, Kenya and Wolayita Sodo in Ethiopia from where power will be connected to the national grids of both countries.

The next step will be to lay high voltage lines connecting the Kenya National Grid and that of Ethiopia.

This will allow Kenya Power to import power, cutting on the supply deficit that has been created by low local generation capacity against a growing demand for power.

Ethiopia is currently constructing the Grand Ethiopian Renaissance Dam, expected to generate 6,000 megawatts, partly for export to the region, and is scheduled to be completed in 2018.

The project is funded by the International Development Association of the World Bank Group and the African Development Bank.

“The Government of the Federal Democratic Republic of Ethiopia and the Government of the Republic of Kenya intend to apply part of the proceeds of these credits to payments under the contract for design, supply, installation and commissioning of HDVC converter stations in Ethiopia and Kenya,” read the tender notice in part.

The Kenya-Ethiopia interconnector will have a capacity of 2,000 megawatts, although in a deal signed last year by Kenya’s Energy ministry and the Government of Ethiopia, the country intends to import an initial 400 megawatts of electricity.

Project funds

In September, the board of AfDB approved a $348 million loan to fund the project, adding to another $684 million loan that had been approved by the World Bank’s board of directors towards the same course.

Of the World Bank funds, Kenya received $441 million and the rest was allocated to Ethiopia. The current installed capacity stands at slightly above 1,500 megawatts, with only less than 30 per cent of the country’s population having access to electricity.

The project, which is set for completion by the end of 2016, is one of many projects being undertaken by countries within East Africa to facilitate trade of power within the region.

The pool consists of all the EAC member states in addition to Ethiopia, Djibouti and Sudan.

According to Ketraco, construction of a 1,000 megawatts interconnector that will link Kenya to Rwanda and Burundi through Uganda is set to begin, while tenders for the construction of a similar connection between Kenya and Tanzania are expected to be floated soon.

“We already have a contractor on the ground to construct the Kenya-Uganda interconnector. Very soon, tenders will be called for the construction of the Kenya-Tanzania interconnector,” said a spokesperson from Ketraco.

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