Kenya signs Sh12bn loan to help power growth in rural areas

President Uhuru Kenyatta and Deputy President Wiliam Ruto witness the exchange of the last mile power project agreement between the Kenyan Government and the African Development Bank signed by Cabinet Secretary for National Treasury Henry Rotich and bank regional director Gabriel Negatu at State House, Nairobi on December 18, 2014. PHOTO | PSCU

What you need to know:

  • “An additional 1.2 million people will access electricity. Connectivity to commercial users in rural areas will also create more jobs and reduce the use of kerosene and firewood which are not environmentally friendly,” Mr Rotich said.
  • The total cost is Sh13.4 billion. The government will top up the Sh1.2 billion when work starts in March 2015.

A Sh12 billion loan agreement has been signed with the African Development Bank and the government to boost rural electrification.

The money will finance the last mile electricity connectivity.

National Treasury Cabinet Secretary Henry Rotich signed on behalf of the Government of Kenya while AfDB regional director Gabriel Negatu did so for the bank.

According to Mr Rotich, the 12,000 metres of low voltage distribution lines will be constructed in last mile electricity connectivity as well as install equipment that will connect electricity to a minimum of 284,200 homes and 30,000 commercial consumers.

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“An additional 1.2 million people will access electricity. Connectivity to commercial users in rural areas will also create more jobs and reduce the use of kerosene and firewood which are not environmentally friendly,” Mr Rotich said.

The total cost is Sh13.4 billion. The government will top up the Sh1.2 billion when work starts in March 2015.

The African Development Bank had additionally committed to finance the Kenya-Tanzania power interconnection to improve supply of electricity in the two countries by creating an East African power pool.

Mr Negatu said the last mile funding is in line with one of the two pillars of AfDB’s country strategy paper for Kenya which focuses on infrastructure.