Economy

KDF cable worries drills Sh1.7bn hole in Ketraco budget

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Summary

  • Taxpayers will pay an extra Sh1.7 billion for the completion of a new power line linking Nanyuki and Meru after the Department of Defence blocked the erection of overhead cables above the military base in Laikipia.
  • The Energy Ministry said the additional funding for the 132-kilovolt single circuit power transmission line will be spent on the acquisition of underground cables for a six-kilometer stretch of the project whose initial budget was Sh5.59 billion.

Taxpayers will pay an extra Sh1.7 billion for the completion of a new power line linking Nanyuki and Meru after the Department of Defence blocked the erection of overhead cables above the military base in Laikipia.

The Energy Ministry said the additional funding for the 132-kilovolt single circuit power transmission line will be spent on the acquisition of underground cables for a six-kilometer stretch of the project whose initial budget was Sh5.59 billion.

This is after the Kenya Defence Forces (KDF) at the Laikipia Airbase successfully objected to the building of pylons within 10 kilometres of the training facility for security reasons.

State-owned Kenya Electricity Transmission Company (Ketraco) has consequently changed to underground cables instead of overhead pylons infrastructure it had earlier budgeted for, thus the request for more funding.

“They (KDF) recommended for underground cable since they had relocated their training facility from Eastleigh in Nairobi to Laikipia, making the overhead cables unsafe for their trainees,” says Energy ministry in project progress report.

The construction of the 97-kilometre-line is aimed at “reducing technical losses, stabilising voltage conditions, and thereby coping with the additional demand” between Nanyuki and Meru towns, according to the Ketraco.

The project, whose work started in October 2012, was initially expected to be completed in September 2022.

“Ketraco is expected to change from the overhead cable to underground on a10km stretch where 4km is shared under KPTSIP (Kenya Power Transmission System Improvement Programme),” the Energy ministry says.

“The remaining 6km stretch requires procurement of the underground cable at an estimated cost of USD 15million (Sh1.70 billion) plus additional monies for wayleave compensation.”

The planned compensation of landowners along the six-kilometre stretch will require further funding, potentially raising the cost of the project beyond Sh7.5 billion on completion.

The government was to shoulder Sh3.78 billion, or two-thirds, of the initial Sh5.59 billion budget with the remainder of the cash coming from KBC Bank of Belgium.

Some Sh3.6 billion had been sunk into the project by last June with 93 per cent of works, being done by CG Holdings Belgium NV, completed.

“TNT (The National Treasury is to issue a letter to fund the same under ADB savings in Ethiopia-Kenya after which GoK funding requirement will be adjusted,” the Energy ministry says.