KENYA - LAST MILE CONNECTIVITY PROJECT


Overview

  • Reference: P-KE-FA0-010
  • Approval date: 19/11/2014
  • Start date: 02/10/2015
  • Appraisal Date: 18/07/2014
  • Status: OngoingOnGo
  • Implementing Agency: Kenya Power
  • Location: All 47 Counties

Objectives

The Last Mile Connectivity Project aims to support the Government's initiatives of ensuring increased electricity access to Kenyans. The existing distribution transformers shall be exploited to the maximum through extension of low voltage network to reach households lying within transformers protections distance. In addition a new distribution system will be installed to increase new customer connections.

Since 2004 an extensive effort has been made to facilitate acceleration of customer connection. The average connection cost including connections fee (minimum 3 kVA) and VAT of Kshs 32,480 for single phase and Kshs44,080for three phases were adopted for customers whose demand was less than 8 kVA and who were within 600 meters of distribution transformers. However, this accelerated connectivity has been achieved at a great cost to KPLC. Since this initiative was implemented, material costs have increased by wide margins. Accordingly, the subsidies by KPLC rose from Kshs1.05 Billion in 2007/2008 to KShs 7.5 Billion in 2011/2012. KPLC, the utility in charge of power distribution has a total of about 35,000 distribution transformers spread across the country. In the vicinity of these transformers, and within a perimeter of 600 meters, the company has the potential to connect 472,000 households (an estimated 1.2 million customers). The cost of connecting these households is estimated at about USD 686 Million. KPLC has a total of about 35,000 distribution transformers spread across the country. In the vicinity of this of these transformers, and within 600 meters, the company has potential to connecting 472,000 Households (an estimated 1.2 million customers). The estimated cost of connecting these households is estimated at about USD 686 Million (KSH 58 billion) working out to Kshs 49,434 per connection.

REA plan of enhancing rural electrification has mainly been targeted to public utility only. Kenya Power steps in to meter the public institutions and to extend the low voltage to the customers in 600 meter radius. In order to rationalize the connectivity work by Kenya Power, REA will henceforth be included in low voltage extension work under the Last Mile Connectivity project. As per the last mile connectivity strategy the rural electrification projects undertaken by REA of connecting public facilities will henceforth include low voltage networks. REA is planning to connect 17 ,000 public facilities in the next five years. The cost of the required low voltage network (Last mile) is around the public facilities is Ksh. 35.7 billion (USD 420 Million) The transmission expansion component of the project seeks to build and enhance the transmission infrastructure, thereby increasing access to electricity in rural areas in Kenya. The Kenya power transmission system is overloaded as a result of lack of sufficient investment in the sector in the last decade. The Government of Kenya has therefore included in the scale up program a component which consists of the extension of 132 kV transmission lines and associated substations to priority areas in order to reduce the current high energy losses caused by the overloading of the system. The Bank financed part of the project components a total 431 km of 132 kV lines, eight new 132/33 kV substations and extension of six bays under ADF XI cycle. The component of transmission line projects included in this project is part of Transmission Improvement Projects which were excluded earlier due to lack of financing.


Benefits

The direct beneficiaries of the project will be the population connected to the distribution system. The project will foster an increase in economic activity (industrial, services, agricultural, commercial) and social wellbeing (households and social institutions).


Key contacts

ASFAW Solomon Abebe - ONEC2


Costs

Finance source Amount
ADFUAC 90,000,000
TotalUAC 90,000,000