Kenya Electricity Generation Company Limited (KenGen) has secured World Bank’s approval for Sh18 billion ($180 million) loan, which would enable the state-owned firm build energy security.
On Monday, KenGen stated World Bank’s approval will also enable it raise up to Sh30 billion ($300 million) in long term commercial financing to be used to refinance its existing commercial loans.
“This will allow the State-run firm to build on Kenya’s gains that have diversified the energy mix and significantly improved electrification bringing much needed energy to millions of households and businesses,” said KenGen managing director Rebecca Miano.
The World Bank funding is provided as an International Development Association (IDA) Guarantee that will help mobilize private sector financing to support KenGen’s financial position in its geothermal development goal.
Asides attracting long term capital for Kenya’s renewable energy development projects, the IDA Guarantee will build on Kenya’s gains that have diversified the energy mix and significantly improved electrification bringing much needed energy to millions of households and businesses.
As reported in the Exchange World Bank Country Director for Kenya Diarietou Gaye noted that “affordable and accessible electricity is essential to ensuring that Kenyan businesses remain competitive in the international market, allows women and youth to run their businesses safely late into the night within informal settlements and strengthens citizen contribution into growing Kenya’s economy.”
Kenya’s energy company seeks to add 1,745 megawatts (MW) of electricity from geothermal sources by 2025 as part of its government push to end power generation from fossil fuels. KenGen produces about 80% of the electricity consumed in the country.
“Our focus is on renewable energy especially wind and geothermal sources,” Miano said, “and the World Bank Guarantee Project will enable us scale up our investment in energy development and help Kenya achieve middle-income economy status by 2030.”