Adani, Africa50 Deal To Tap Private Sector Expertise – KETRCO

Kenya Electricity Transmission Company (KETRACO) says its deal with Adani and Africa50 for power transmission line construction brings private sector expertise.

Its Managing Director John Mativo asserted that this partnership aims to infuse private sector expertise into the construction of high-voltage transmission lines, crucial for stabilizing Kenya’s power supply and economic growth.

According Mativo,Kenya’s current power transmission infrastructure suffers from decades of underinvestment, leading to frequent power blackouts that have hampered economic progress. 

The situation has intensified financial pressure on the government, as public debt levels have soared due to extensive external borrowing hence the need for Private Public Partnership (PPP).

 “Investment in transmission infrastructure is costly and capital incentive. KETRACO projects have majorly been financed by the exchequer and sovereign borrowing from Development Financial Institutions. (DFIs). Over 20 transmission projects have been supported by DFIs since 2008. Nonetheless, the country cannot continue to borrow from these institutions due to competing social needs,”said Mativo.

He disclosed that the country faces a financial gap of approximately USD 5 billion (Kshs. 650 billion) to meet its transmission infrastructure needs.

To address this challenge, KETRACO is leveraging its Transmission Master Plan 2023-2042, which outlines the necessity for 5,672 kilometers of new high-voltage lines.

The plan envisions expanding the transmission network by about 9,605.5 kilometers and increasing transformation capacity by 15,891 MVA. 

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According to Mativo,the typical project cycle cycle of 5-8 years for development financing would lead to long waiting time for new funds from Development Financial Institutions (DFIs) leading to severe repercussions for Kenya’s power infrastructure.

His sentiments come hot on thr heals of a public rebuke directed toward government by Kenyans over transparency of the Adani deal.

Already a legal has faultee  KETRACO over transparency with the utility firm on the receiving end over the controversial deal.

In a letter addressed to its Managing Director, John Mativo, law firm IC Law Advocates has requested access to critical information regarding the partnership.