The government has disclosed an ambitious plan to build over 2,700 kilometres of power transmission and distribution lines to connect 1.4 million homes over the next three years even as doubts linger over the source of the funding.
National Treasury Cabinet Secretary John Mbadi revealed the plan in the 2025 Budget Policy Statement (BPS) which shows that 1,742 kilometres (km) and 1,050 km of transmission and distribution lines will be built, respectively. Additionally, 33 distribution and 21 transmission substations will be set up.
The plan is, however, fraught with funding concerns for the multi-billion projects amid the constraints facing the Exchequer and setbacks following recent plans to build lines and substations in a deal with India’s Adani Group were canceled.
“Over the medium term, the government will build on the progress made by strengthening policy guidelines and laws to enhance energy generation, transmission, and distribution aimed at connecting 1,440,000 new customers and 1,080 public facilities to electricity,” Mr Mbadi says.
The plan will also significantly boost Kenya Power through increased electricity sales, helping it to remain on the profitability path.
But funding woes are the biggest threat to the ambitious plan given that thinning fiscal space has made it increasingly difficult for the Exchequer to fund these projects, forcing the country to turn to Public Private Partnerships (PPP).
The maiden PPP-funded construction of the lines and substations was aborted after the cancellation of the controversially awarded deal to Adani Group’s subsidiary, Adani Energy in October last year.
This came after founder of the conglomerate, Gautam Adani was indicted in the US over bribery allegations.
Adani had been tapped to build the 208.73-kilometre (km) 400 kilovolts (kV) Gilgil-Thika-Malaa-Konza, 95km 220kV Rongai-Keringet-Chemosit and the 70km 132kV Menengai-Olkalou-Rumuruti lines.
The Indian was also to build two substations, with the total project cost being Sh95.16 billion. Adani was to recover the money by charging consumers a special tariff over 30 years.
Mr Mbadi added that the government is also keen to drill 34 geothermal wells, which are key in increasing the supply of clean and affordable electricity, helping ensure a more stable grid to meet rising demand besides a reduction in the cost of power.
Building the lines is key to helping Kenya Power reduce the amount of electricity lost (technically called system losses). Kenya Power is grappling with high system power losses which hit 23.65 percent in December last year from 23.19 percent at the end of 2023.
Kenya Power has severally attributed the high system losses to the use of distribution lines to transmit electricity given that the lower the voltage the higher the system losses. Theft of electricity especially in informal settings is also driving the losses.
The three lines and two substations are yet to attract new investors, meaning that they might be part of the ambitious plan announced by Mr Mbadi.
