President Ruto to tap private sector money in building of electricity lines

President William Ruto during an engagement between the national and county governments and the private sector

President William Ruto during an engagement between the national and county governments and the private sector in Nairobi on June 2, 2023.

Photo credit: Wilfred Nyangaresi | Nation Media Group

The government is planning to tap private sector money in the construction of electricity transmission lines, ending government funding into the multi-billion sector.

President William Ruto said as one of the ways to address cases of power rationing and loss of power in some parts of the country, the government is already in talks with some investors to put in their money towards the development of transmission lines.

The private investors would then be compensated through a wayleave charge when electricity is transmitted through the lines, the President said.

“We are changing the model in Kenya Electricity Transmission Company (Ketraco). We were using government money to develop transmission lines. We want the private sector to develop transmission lines, we will pay them a wayleave charge when using to transport our energy,” President Ruto said yesterday.

The President was speaking during a Presidential Economic Dialogue with governors and business management organisations, with a focus on some seven key economic sectors identified to support his bottom-up economic agenda.

Among key sectors identified to spur economic growth through value addition are leather, agriculture (cotton, pyrethrum), manufacturing (edible oils), construction and transport (electric mobility).

The President met several county chiefs led by Council of Governors chairperson Anne Waiguru, Trade CS Moses Kuria and the Private sector led by Kenya Private Sector Alliance (Kepsa) CEO Carole Kariuki, where all the sides expressed areas of concern.

“We are in discussions with people who can invest in transmission lines,” the President added, indicating that the law enabling the shift is already in place.

The President also said the government would consider special electricity tariffs for manufacturers operating within Special Economic Zones and those operating outside, to address high power cost concerns by local businesses.

Dr Ruto said the change at Ketraco operations will be done alongside reforms at Kenya Power to address cases of high rates of power losses.

Housing Fund

And on the proposed Housing Fund, the President remained adamant despite concerns from the private sector over the management of the billions of shillings the government plans to collect from workers and employers monthly.

“We are not against the whole concept. We, as the private sector, feel there are questions to be asked [because] previous similar projects have had issues of governance of funds,” said Kenya Association of Manufacturers Chairperson Rajan Shah.

Mr Shah added that most companies are currently hurting and can hardly afford the costs being proposed in the Housing Fund, but the President insisted its implementation ‘is now or never’.

“Are we going to stop a whole project that can hire a million young people every year, a project that will support our industrialisation agenda because we are not sure about governance? We must sort out the governance issue. It’s now or never,” Dr Ruto said.

He admitted that the structure of how the Fund will operate is yet to be established but promised to take personal responsibility over the management of the funds.

The President said the programme will be key to addressing the state of joblessness in the country which he termed as an emergency, as well as growing home ownership.

The President also refuted claims that he was forcing the idea on unwilling workers and employers.

“I’m not bullying you,” he said.