Ruto: Adani energy deal will reduce power costs
What you need to know:
- Ruto said the Adani deal would see the firm build and operate several key power transmission lines.
- The deal between Ketraco and Adani Energy Solutions Limited, which is estimated at Sh95.68 billion.
President William Ruto has publicly defended the controversial Sh95 billion deal between Kenya Electricity Transmission Company (Ketraco) and Adani Energy Solutions noting that it would lead to reduced electricity prices in the country.
President Ruto spoke on Thursday at the Menengai Geothermal fields in Nakuru, where he presided over the launch of the Orpower-Twenty-Two power plant.
The independent power producer and two others — Globeleq Limited and Sosian Menengai Geothermal Power Limited — are expected to add 105 Megawatts to the national grid.
President Ruto said the contested Adani deal would see the Indian firm build and operate several key power transmission lines which are expected to reduce electricity prices once commissioned.
"My government is committed to enter into private partnerships with the private sector in infrastructure projects to help reduce tax burden and debt reliance. An example is the partnership between the government and Adani Energy Solutions that will lead to reduced price of electricity," he said.
"The partnership will fully address the perennial power losses in the country through the installation of new power lines and stations.”
The deal between Ketraco and Adani Energy Solutions Limited, which is estimated at Sh95.68 billion (USD 736 million), will see the Indian company develop, finance, construct, and operate critical transmission lines and substations across the country.
The agreement, according to the government, aims to tackle Kenya’s chronic power outages and ensure more reliable electricity access to support the country’s growing economy and industrial ambitions.
“All Kenyans are well aware of the significant challenge that our country faces with persistent power blackouts. These projects are designed to significantly enhance our national electricity infrastructure (transmission lines and substations), ensuring reliable and widespread access to power that will support Kenya’s growing economy and development goals,” said Energy Cabinet Secretary Opiyo Wandayi, who also spoke at the event.
The CS further stated that the comprehensive project would be fully funded by the private sector, with Adani Energy Solutions raising both debt and equity.
Under the agreement, Adani will manage the infrastructure under the agreement for 30 years, ensuring its long-term sustainability before transferring it to Ketraco.
On October 11, while signing the agreement, Mr Wandayi revealed that Ketraco conducted comprehensive due diligence on Adani Energy Solutions as the project proponent, along with thorough stakeholder engagement.
He said the project was aligned with the government’s objective of expanding access to electricity across the country, minimise transmission losses and address blackouts.
The ambitious project includes the construction of several high-voltage transmission lines and substations as follows, including the Gilgil-Thika-Malaa-Konza 400kV double-circuit line, spanning 208.73 kilometres.
It will include construction of new substations at Gilgil, Thika, and Malaa, along with substantial extensions at Konza.
The Rongai-Keringet-Chemosit 220kV line, covering 99.98 kilometres, will feature new substations in Rongai, Keringet, and Chemosit.
Others include the Menengai-Ol Kalou-Rumuruti 132kV line, covering 89.88 kilometres, with substations in Menengai, Ol Kalou, and Rumuruti.
The Lessos 400/220kV Substation, which will support Kenya’s 400kV transmission network and improve regional power stability, and the Thurdibuoro 132/33kV Substation, designed to expand the local distribution grid and help bring reliable power to underserved areas, are also part of the plan.
President Ruto reiterated that the government was determined to fully transition the country from fossil fuel to green energy in its effort to combat climate change.
He observed that at least 87.42 per cent of power in the country was green, with geothermal power contributing the largest share of 45.5 per cent to the national grid.
Dr Ruto said green energy is affordable and has the capacity of significantly bringing down the cost of power, especially for domestic consumers.
He said being a catalyst to development pillar under manufacturing, the reduced cost of power will attract foreign investors, reduce the cost of production and accelerate job creation, especially for the youth.
"Progressively affordable and sustainable electricity which is more reliable compared to fossil or hydro power will contribute to lowering the cost of living in the long term," the Head of State noted.
President Ruto also on Thursday witnessed the signing of a deal between KenGen and Kaishan Group Company Limited, a Chinese firm for the production of ammonium fertilizer at the Menengai Geothermal fields. The production will kick off in 24 months.
