KETRACO signs Sh95bn deal with Adani Group to boost Kenya's electricity grid

The Kenya Electricity Transmission Company Limited (Ketraco) has signed a Sh95.68 billion Project Agreement with Adani Energy Solutions Limited.

The deal, according to the Ministry of Energy, is aimed at enhancing the country's electricity transmission network and addressing the frequent power blackouts that have affected Kenya.

Energy Cabinet Secretary Opiyo Wandayi confirmed the agreement on Friday, explaining that it marks the beginning of a major project that will improve the national electricity infrastructure by developing, financing, constructing, and maintaining critical transmission lines and substations across the country.

He noted that the project will help ensure reliable and widespread access to power, which is crucial for Kenya's economic growth and development.

"I am pleased to announce the successful signing of the Project Agreement between KETRACO and Adani Energy Solutions Limited today," Wandayi said.

"The agreement marks the beginning of a transformative initiative to develop, finance, construct, operate, and maintain key transmission lines and substations across Kenya," he added.

The project, estimated at Sh 95.68 billion, will be fully funded by Adani Energy Solutions, with the company raising the necessary funding through a combination of debt and equity.

Adani will manage the infrastructure for the next 30 years, after which the project and all its assets will be transferred to KETRACO.

Going further, CS Wandayi assured that the Kenyan government would not incur any financial costs, emphasising that the competitive bidding process used to finalize the project will ensure value for money.

"The project cost will be crystallized through a competitive bidding process that will be jointly handled by KETRACO and the Project Company, thus ensuring significant value for money for the country," he noted.

The CS further noted that the process will prioritise local content and business opportunities for Kenyans.

Wandayi explained that this deal is part of the government's efforts to improve the electricity grid and reduce transmission losses.

The signing of the agreement follows four months of negotiations, during which KETRACO conducted comprehensive due diligence on Adani Energy Solutions, confirming their capacity to handle the project.

"Before signing the agreement, KETRACO conducted comprehensive due diligence on Adani Energy Solutions as the project proponent, along with thorough stakeholder engagement. This ensures that all concerns have been addressed and the project is primed for successful execution," Wandayi added.

The Energy CS reiterated that the government is committed to projects that align with its goal of expanding access to electricity and ensuring long-term sustainability.

He also stressed that the project will bring numerous benefits to the country, including creating job opportunities and boosting economic activities in different regions.

"All Kenyans are well aware of the significant challenge that our country faces with persistent power blackouts. This project will empower communities, create job opportunities, and stimulate economic activity at the grassroots level in different parts of the country," Wandayi said.

The project includes the construction of several high-voltage transmission lines and substations, which will be essential in strengthening Kenya's electricity grid.

This collaboration, according to Energy CS, ensures long-term management of vital infrastructure and secures the future of Kenya's energy supply.

"The government remains committed to supporting the timely and successful implementation of transformative development projects such as this," Wandayi said.

"We believe this initiative will not only bolster our energy infrastructure but also contribute to the economic and social transformation of the country," he added.