Adani Out, Africa50 In: KETRACO Seals Ksh.45B Power Deal
The Kenya Electricity Transmission Company (KETRACO) is in the final stages of sealing a public-private partnership with Africa50, a leading pan-African infrastructure investor.
This move follows KETRACO’s decision to cut ties with Adani Energy. The new agreement, worth Ksh.45 billion, will fund the construction of two major power transmission lines.
Facing financial hurdles, KETRACO is turning to private investors to enhance the power grid and reduce energy losses.
“Africa50 was the first to express interest in Kenya back in 2018. They have been engaging with us for the past seven years,” said KETRACO Managing Director Dr. Eng. John Mativo.
With a growing demand for electricity and the government nearing its debt limit, KETRACO says private-sector partnerships are the only way to meet expansion goals.
“We must explore new funding options because electricity demand is rising, the population is growing, and investors expect reliable power. Kenyans want electricity 24/7. That’s why we are considering PPPs and asset monetization,” Dr. Mativo explained.
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Africa50 will construct two key transmission lines: a 400-kilovolt line from Lessos to Loosuk and a 220-kilovolt line from Kisumu to Musaga.
KETRACO and Africa50 have already agreed on key project costs, including Ksh.45 billion for construction and a 7.25% debt financing rate.
“Their current return on equity is 16%, but we are negotiating to bring it down to 14%. Similar projects in India are at around 15.5%, so we are pushing for a better deal for Kenyans,” Dr. Mativo added.
Meanwhile, KETRACO is finalizing the termination of its contract with Adani Energy Solutions.
“Adani had a separate project portfolio. We are wrapping up the termination process pending approval from the Attorney General. At the same time, we are working with financiers like the World Bank to hire transaction advisors and restructure these projects. Our goal is to launch new tenders before June,” he stated.
Adani Out, Africa50 In: KETRACO Seals Ksh.45B Power Deal
