The Ethiopian Electric Power and Kenya Power & Lighting Company Plc have signed a power purchase agreement for the sale and purchase of 200 MW of energy in the first phase of the power export with expected increase of power export to 400 MW in due course.
CEOs of the companies signed the Power Purchase Agreement (PPA) in the presence of President Uhuru Kenyatta and Cabinet Secretary in the Ministry of Energy Monica Juma, and Ethiopia’s Finance State Minister Eyob Tekalign.
After trail transmission of power in few weeks, full capacity power export is agreed to start in November, 2022.
According to Ministry of Finance, the Kenya-Ethiopia Electricity Highway Project (Eastern Electricity Highway Project) is yet another new export market for Ethiopian Electric Power, expanding its market base in the continent by generating significant amount of revenue to the company.
The interconnection with Ethiopia will ensure access to reliable and affordable energy to around 870,000 to 1.4 million Kenyan households, of which 18% will be located in rural areas.
In a broader sense, the transmission line will in the long run benefit countries in North, East, and Southern Africa through interconnections from Southern Africa Power Pool and Eastern African Power Pool all the way to Egypt and Sudan in the north, the press release added.
The overall investment in the project was 1.26 billion USD, the World Bank providing a loan of 684 million, while the African Development Bank and French Development Agency providing 338 million USD and 118 million USD, respectively.
The Governments of Ethiopia and Kenya are funding 32 million and 88 million USD, respectively, it was learned.
Ministry of Finance stated that the successful completion of the project is a testament of the strong bilateral relationship between the two countries as well as an example on how regional economic cooperation materializes to the benefit of the continent.