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Economy

Contracts to link 650,000 homes to electricity signed

Kenya Power CEO Ken Tarus and African Development Bank official Gabriel Negatu sign a funding deal on November 9. photo | DIANA NGILA
Kenya Power CEO Ken Tarus and African Development Bank official Gabriel Negatu sign a funding deal on November 9. photo | DIANA NGILA 

Nearly 650,000 households will be connected to electricity after Kenya Power #ticker:KPLC awarded contracts to construct new power lines and transformers into villages at a cost of Sh30 billion.

Kenya Power on Thursday launched the second phase of the government’s mass connectivity project introduced in 2015 where homes are connected at a subsidised fee of Sh15,000, about half the previous cost.

The phase will take 18 months and connect 626,700 homes in a project jointly funded by loans from the World Bank and African Development Bank.

Some 15 contractors have been picked, seven of them Kenyan, to lay the infrastructure and each will provide a performance bond equivalent to 10 per cent of the value of their contracts.

“This project puts us on a firm path towards attaining universal power access by 2020,” said Kenya Power managing director Ken Tarus.

The drive, dubbed last mile connectivity project, involves installing transformers and low-voltage lines to reach homes in remote villages.

The venture has opened up job opportunities and a business bonanza for suppliers. The project launched yesterday will use 233,000 concrete and 397,000 wooden poles, 10,000 kilometres of cables, and 1,000 transformers.

Kenya Power launched the first phase of the project in the second quarter of 2015 with 280,000 homes so far hooked to power out of the targeted 314,200.

Its customer base has grown from one million in 2010 to 6.3 million, with the power connectivity access rate rising to 70 per cent, according to Dr Tarus.

But Kenya Power’s sales have not grown with a similar margin because the connections are driven by low electricity consumers.

Under the project, Kenya Power approaches potential customers and offers to hook them to the grid in clusters, unlike in the past when home owners had to apply for connection.

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