SGR electric upgrade to cost taxpayers Sh49bn more

Taxpayers will fork out nearly Sh49 billion more following fresh plans for the electrification of the standard gauge railway (SGR) line between Mombasa and Nairobi.

Transport secretary James Macharia said the 609 kilometres of railway track from Mombasa to Nairobi would be made electric in a deal reached with Uganda and Rwanda.

The locomotives will in the immediate term be powered by diesel, but the electric upgrade will be done within five years and ahead of Uganda linking its SGR line to the Kenyan one.

China Road and Bridge Corporation, which was appointed to build the Mombasa-Nairobi line, will be offered 15 per cent over the current construction costs of Sh327 billion or Sh49.05 billion more to upgrade the line.

An electric track is needed for fast movement of bigger containers and passengers in the quest to boost East Africa’s competitiveness as an investment destination.

“The protocol signed between the four countries was to do an electric track. In Kenya, we started with a diesel one but we need to convert it to electric before Uganda commissions their bit, which is in about five years,” said Mr Macharia.

“In our estimates, to convert the track will cost about 15 per cent above the cost incurred for the SGR,” he added.

The faster railway being built from Mombasa port is expected to reach Nairobi early next year and open up to commercial services by mid-2017.

The second leg of the Mombasa-Nairobi line will extend to Naivasha and eventually stretch to the Kenyan border town of Malaba from where it will link up with the Ugandan line as well as other landlocked countries, including Rwanda.

READ: New rail set to increase transportation of goods by 32 per cent

The goal is to cut the cost of transport and boost trade, by replacing the slower, narrow-gauge line.

Chinese ambassador to Kenya Liu Xianfa told the Business Daily that President Uhuru Kenyatta supports the upgrade plans.

“We told the President this was possible, but we needed access to reliable power,” said Dr Xianfa. “If effected, it means we can have lunch in Nairobi and later be in Mombasa for dinner in the evening.”

Dr Xianfa reckons that the electric train will move at a speed of 240 kilometres per hour, up from the planned diesel engine speed of 120 kilometre per hour.

The tender for the multi-billion shilling railway project was won by China Road and Bridge Corporation and sparked widespread criticism over the transparency of the process.

Kenyan officials acknowledge that there was no public bidding, which they say was a condition for Chinese loans used to help fund construction and some MPs have complained that the deal was overpriced.

Eximbank China is providing a commercial loan of Sh162 billion and a concessional loan of Sh166 billion to fund the first 609km of SGR from Mombasa to Nairobi that is expected to cost Sh447.5 billion, including financing expenses.