Regional integration in East Africa: the AfDB Group supports power trade between Kenya and Tanzania

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ADF US $144.9 million loan to Kenya–Tanzania Power Interconnection Project

The Board of Directors of the African Development Bank Group (AfDB) approved on Wednesday, February 18 in Abidjan an African Development Fund (ADF) Loan of US $144.9 million, to the Kenya–Tanzania Power Interconnection Project.

The project will allow the two countries to exchange power. In addition, the Kenya–Tanzania Interconnection Project plays an important role in promoting regional integration through power trade. The project is expected to improve the supply, reliability and affordability of electricity in the Eastern Africa region through cross-border exchanges of cheap and cleaner surplus power from neighbouring countries.

The project involves the construction of approximately 508 kilometres of transmission line between Kenya and Tanzania (about 93 km in Kenya and 415 km in Tanzania) and associated substations in Arusha and Singida (Tanzania).

The line will have a transfer capacity of up to 2,000 MW in either direction. The Ethiopia–Kenya interconnection line will allow for the interconnection of the Eastern Africa Power Pool to the Southern African Power Pool and further in the future to Northern Africa through the East Africa Electricity highway. At its initial stage, the project will allow Ethiopia and Kenya to exchange power, followed by the import and export of energy from the interconnected countries. 

Following the Board’s approval, the Director of the AfDB’s Energy, Environment and Climate Change Department, Alex Rugamba, explained that the project aligns with the pillars of the regional integration strategy papers (RISPs) for Eastern Africa, which focus on regional infrastructure and capacity building. It also fulfills the objectives of the New Partnership for Africa's Development (NEPAD) in terms of regional integration and promotion of infrastructure development through regional co-operation in key productive sectors such as energy. He also added that the interconnection line will create competitiveness in the energy sector and will encourage private sector investing in the generation of electricity by facilitating power transfer through the interconnector.