Kenya-AfDB to Facilitate 300 million Euro Loan for Kenyan Power Project
Dakar, 12 May 2009 – The African Development Bank (AfDB) Group will facilitate the entire 300 million euros loan for Kenya’s Lake Turkana Wind Power Project, out of which, the institution intends to provide 100 million euros.
The loan, which represents 70 percent of the project cost, will be sourced from development finance institutions (DFI) and commercial sources. AfDB is the Mandated Lead Arranger (MLA) for the loan, which has a DFI loan tenor of up to 12 years and 9 years from commercial sources.
Lake Turkana Wind Power consortium (LTWP), the handler of the project, plans to provide 300 MW of clean power to Kenya’s national electricity grid by taking advantage of a unique wind resource in Northwest Kenya near Lake Turkana.. Using the latest wind turbine technology LTWP can provide reliable and continuous clean power to satisfy up to about 30 percent of Kenya’s current total installed power.
LTWP will construct a "wind farm" consisting of 353 wind turbines, each with a capacity of 850 KW. The wind power project is expected to start production in June 2011 and reach full production of 300 MW by July 2012. It will add 30 percent or more to the existing installed capacity in Kenya. Wind turbine technology has seen recent rapid improvement with the development of turbines such as the Vestas V52 that is the design standard selected by LTWP.
The AfDB’s Manager, Infrastructure Finance Division, Hela Cheikhrouhou, said Monday, May 11, during a presentation on the power project ahead of the Bank’s 2009 Annual Meetings, that “at 300 MW, the project will be of high impact and high visibility for the Kenyan economy. It will increase Kenya’s installed capacity by 25 percent and represents about 12.5 percent of additional capacity needed by 2020.”
“The project, which is a low-cost, clean and renewable energy venture, will help diversify Kenya’s energy source and substitute diesel-based generation. It is a good demonstration of a PPP co-operation by concurrent development of the transmission line,” she added.
Mrs. Cheikhrouhou recalled that, the Bank, along with the sponsors, met at a DFI seminar in Tunis where participants indicated interest in the project
The Bank, she assured, will continue to hold bi-monthly DFI meetings to discuss project updates and financing terms.