KPLC AND AFD SIGN A 56 MILLION EURO (6 BILLION KENYAN SHILLING) FINANCING AGREEMENT FOR THE IMPLEMENTATION OF KENYA POWER’S DISTRIBUTION MASTERPLAN
Kenya Power Managing Director and Chief Executive Officer, Dr. Ben CHUMO, together with the Regional Director of AFD Nairobi Office, Mr. Yves BOUDOT, in the presence of the French Ambassador to Kenya, H.E. Mr. Rémi MARECHAUX, have today signed a financing agreement for the provision by AFD of a 56 M€ loan to Kenya Power. The funds made available to Kenya Power will partially support the implementation of the company’s Distribution Masterplan for 2012-2030. The investments will strengthen and expand the distribution network of the power utility in three major zones of economic activity in Kenya: Mombasa, Kisumu and Nairobi. Upon implementation, the Distribution Masterplan projects are expected to decrease the number of power shortage and to increase of the reliability of the network. This will allow Kenya Power to increase its income and will help the industrialists situated in regions covered by the project to better manage their costs (by limiting the need for private generators). In addition, the projects will enable the company reduce technical losses through improved energy efficiency of around 10 GWh / year. This reduction of technical losses will further strengthen the financial performance of Kenya Power and will reduce greenhouse gas emissions by around 4,000 tons of CO2 eq./ year. At the same time, the Distribution Masterplan projects will increase the distribution network capacity and, consequently, will contribute to improve the living conditions of the population.
This financing is provided by Kenya Power at AFD own’s risks, without the guarantee of the Government of Kenya. It highlights the very good financial performance of Kenya Power and the confidence of AFD in this company and the overall Kenyan electricity sector. Kenya Power Managing Director indicated that “this financing is one of the first of its kind and is a clear indication that Kenya Power has come of age to directly access financial resources to invest in its network”. He noted that this was all the more important as it allowed Kenya Power to “improve the reliability and quality of electricity distribution, which is the primary role of Kenya Power”.