The African Development Fund is to finance a multibillion electricity highway project between Kenya and Ethiopia to the tune of $348 million.
The line will see Kenya achieve its plan of connecting an additional 870,000 households to the national grid by 2018. The government has laid down a plan to ensure that a total of 1,400,000 additional households are wired by 2022.
The board of the continental bank gave a green light to the deal, signaling the beginning of one of Africa’s most ambitious electricity projects connecting two countries.
The African Development Bank has been increasingly involved in multibillion infrastructure projects in Kenya among them the now complete Thika Super-highway which is a multilane highway and the first of its kind in East Africa.
The project will see the construction of a 1,068 kilometres high-voltage DC 500 kV transmission line connecting Kenya and Ethiopia. It is slated for commissioning in mid-November, 2013.
Once complete, the project will have a power transfer capacity of up to 2,000 MW with mini-stations at Wolyatta in Ethiopia and Suswa in Kenya.
Other financing partners in the project include the World Bank, the French Development Agency (AFD) and the governments of Kenya and Ethiopia
“The financing of this project further underscores our position as the biggest infrastructure funding partner for Eastern Africa. We are committed to partnering with African governments and other development agencies to make the infrastructure dream true,” said Gabriel Negatu, African Development Bank’s Regional Director for East Africa.
Kenya is facing a sharp electricity deficit due to its overreliance on the Seven Folks Dam for countrywide supply. The situation has seen the government through the ministry of energy source for additional power from Independent Power Producers at seriously inflated costs. The country has in the recent past pumped huge capital into energy projects with keen emphasis on renewable sources such as wind and solar.
Ethiopia on the other hand enjoys a comfortable surplus of electricity and the connection with Kenya will see the country earn handsome returns by selling the excess power to the other un deserved East African countries through Kenya.
The long term plan according to the Kenyan Ministry of Energy Officials is to connect the grid all the way to the Southern African Power Pool in what will create electricity supply stability in the region.
“We want to connect the entire East Africa and the Southern Power Poll with our eyes set on a connection all the way to Egypt. This is the only way we can ensure adequate electricity supply in the East Africa region,” said Kiraitu Murungi, Kenya’s Minister for Energy.