KETRACO signs Sh40.4Bb PPP deal to expand power transmission network
The Kenya Electricity Transmission Company (KETRACO) has today signed a landmark Sh40.4 billion ($311 million) Public-Private Partnership (PPP) agreement with a consortium comprising Africa50 and the Power Grid Corporation of India.
The deal, finalized on Monday, marks a significant shift in Kenya’s energy infrastructure strategy following the cancellation of the controversial Adani Energy Solutions partnership in November 2024.
The agreement focuses on the financing, design, construction, operation, and maintenance of two critical high-voltage transmission lines. Under the PPP framework, the consortium will manage the infrastructure for 30 years, recovering their investment through availability-based tariffs, before transferring the assets back to KETRACO. The project is the first Independent Power Transmission (IPT) model of its kind in Africa, designed to bridge Kenya’s infrastructure financing gap without adding to the public debt burden.
Speaking during the signing ceremony in Nairobi, Treasury Principal Secretary Dr. Chris Kiptoo emphasized that the project represents a sustainable path forward for national development. “This project reaffirms the Government’s commitment to accelerating economic development through strategic investments in energy infrastructure anchored on sound policy and disciplined planning,” Dr. Kiptoo stated. “Crucially, this initiative is fully financed by the private sector, protecting the exchequer from further strain while delivering the grid reliability our industries demand.”
The investment will fund two major transmission corridors intended to address persistent power instability. The first is the Lessos–Loosuk Line (400kV), a high-capacity line traversing Nandi, Elgeyo Marakwet, Baringo, and Samburu counties, which is critical for evacuating geothermal power from the Baringo–Silali fields. The second project is the Kibos–Kakamega–Musaga Line (220kV), serving Kisumu, Vihiga, and Kakamega counties.
Alain Ebobissé, CEO of Africa50, highlighted the strategic importance of the partnership in shifting the continent’s investment focus. “In the past few years, a lot of emphasis has been placed on attracting private investments in energy production infrastructure in Africa,” Ebobissé said. “It is time to also focus on catalyzing private investment into the development of power transmission networks across Africa as these are a critical link to improving electricity access, especially in underserved communities.”
This signing comes just weeks after President William Ruto directed the cancellation of a proposed Sh95 billion deal with India’s Adani Energy Solutions in November 2024. The Adani deal faced intense public scrutiny and legal challenges following the indictment of the group’s founder in the United States. The government has pivoted rapidly to the Africa50 and Power Grid Corporation consortium to ensure critical grid upgrades are not delayed further.
Shri K. Sreekant, Chairman and Managing Director of Power Grid Corporation of India, expressed confidence that the project would set a benchmark for the region. “A robust transmission network not only imparts reliability and security to the electricity grid but also allows non-discriminatory access to buyers and sellers which spurs the competition that results into competitive electricity prices to the ultimate consumer,” Sreekant remarked. “We hope that the present transmission project in Kenya shall serve as a model for undertaking more such projects in Kenya as well as other African countries.”
Eng. Kipkemoi Kibias, KETRACO’s Acting Managing Director, noted that the utility faces a massive funding requirement to modernize the grid. “We have a financing gap of approximately $5 billion needed to construct 8,000 kilometers of lines over the next 20 years,” Kibias explained. “This PPP model allows us to bridge that gap efficiently, ensuring that regions like Western Kenya, which have historically suffered from unstable power, finally get the redundancy and reliability they deserve.”
The project is expected to break ground in early 2026, with a construction timeline of approximately 18 to 24 months.
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