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Kenya, AfDB sign deal to boost power connectivity in rural areas

Saturday December 20 2014
KPLC

Kenya Power workers upgrade power lines. PHOTO | FILE

Kenya and the African Development Bank (AfDB) have signed a $135 million loan agreement to increase the number of rural households connected to the power grid.

The project, dubbed the Last Mile Connectivity, is estimated to cost $148.8 million of which AfDB will contribute $135 million while the Kenya government will contribute $13.8 million. The project entails construction of a power distribution network of 12,000 metres of low-voltage distribution lines, installation of equipment for the connection of a minimum of 284,200 homes and a minimum of 30,000 commercial customers. 

“Successful completion of the project will see an additional 1.7 million people with access to electricity. The last Mile Connectivity project is a critical part of the government’s commitment to programmes aimed at increasing energy access in the country,” President Uhuru Kenyatta said during the signing ceremony held at State House, Nairobi, last Thursday.

Despite the abundance of sources of power, the majority of rural households in Kenya still lack electricity. High electricity costs have also stagnated Kenya’s industrialisation, which makes the country’s manufactured products uncompetitive.

The government has made a commitment to add an additional installed capacity of 5,000MW in the near future, through the exploitation of geothermal sources of power. Recently, the Kenya Electricity Generating Company said it will spend about Ksh142 billion ($1.5 billion) to exploit steam power at its Olkaria geothermal field.

Speaking at the signing ceremony, regional director of AfDB’s East Africa Resource Centre Gabriel Negatu said the last mile connectivity project will be a game changing initiative bound to revolutionise Kenya’s access to energy.

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“After it is completed, the project will bring electricity to more than 300,000 Kenyan homes and businesses at a reasonable cost.

National Treasury Cabinet Secretary Henry Rotich said co-operation between Kenya and the AfDB had grown over the past 50 years, adding that the financial institution has cumulatively contributed to the country’s development financing to a total of Ksh270 billion ($3.03billion).

“These resources have been channelled to support various sectors of our economy namely; roads, energy, water and sanitation, agriculture and environment, health, education, institutional reforms and some projects in the private sector,” Mr Rotich said.

The project will target residents within a 600-metre radius of the existing 35,000 distribution transformers spread across the country.

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