Tuesday, November 5, 2013

General Electric now gets licence for 61MW Kinangop wind power farm


A wind power project in Ngong. Kenya plans to tap renewable energy to raise capacity beyond the current total of 1,500MW. Photo/FILE
A wind power project in Ngong. Kenya plans to tap renewable energy to raise capacity beyond the current total of 1,500MW. Photo/FILE 
By CHARLES MWANIKI
In Summary
  • Energy Regulatory Commission (ERC) is set to issue the licence for the Sh12.7 billion ($150 million) project to be developed jointly by GE and Aeolus Kenya.
  • ERC had also issued a licence to Ketraco for construction of power lines to transmit electricity from the project to the national grid.
  • GE is likely to contribute a maximum of Sh3.5 billion for financing the project in line with its current policy of contributing between Sh1.7 billion ($20 million) and Sh3.5 billion ($40 million) for power ventures in Kenya.

American conglomerate General Electric is Wednesday set to get a licence to develop a wind power farm in Kinangop, paving the way for the start of construction of the 61 mega watts project.
The Energy Regulatory Commission (ERC) is set to issue the licence for the Sh12.7 billion ($150 million) project to be developed jointly by GE and Aeolus Kenya.
It is expected to feed power to the national grid in mid 2015.
ERC acting director-general Fredrick Nyang said that in addition to issuing the power generation licence, the regulator had also approved the power purchase agreement for the project.
“With the approval of the PPA and the issuance of licence, they are expected to start construction within the next one year.
‘‘The PPA approvals are what they use in finalising their debt and financing arrangements,” said Dr Nyang in an interview.
He said that in addition to licensing the project developers, ERC had also issued a licence to Ketraco for construction of power lines to transmit electricity from the project to the national grid.
The project will be a boost to Kenya’s plans for tapping renewable energy to raise capacity beyond the current total of 1,500 MW.
Spanish firm Iberdrola Engineering announced last month that it had signed an agreement worth Sh9.7 billion (€85 million) for the construction of the Kinangop wind farm.
According to the Iberdrola statement, the project will be owned by the Macquarie and Old Mutual sponsored African Infrastructure Investment Fund II and the Norwegian Investment Fund for Developing Countries (Norfund), with South African Standard Bank acting as Mandated Lead Arranger for the deal.
“The Iberdrola subsidiary will handle engineering, procurement, construction and commissioning. The project will have a total of 38 wind turbines manufactured by General Electric.
‘‘The hubs for each 1.6MW wind turbine will stand almost 80 metres and have a rotor diameter spanning 82.5 metres,” said Iberdrola.
The company is also part of a consortium putting up a 13.6MW wind farm for KenGen in Ngong Hills, and Ketraco’s Nairobi Ring Project which will see an overhaul of the capital’s power distribution network. Both projects have a combined value of over Sh7.5 billion.
As the lead financial arranger for the project, Standard Bank Group (and its subsidiary CfC Stanbic Bank) announced on October 3 that it had underwritten a Sh7.65 billion ($90 million) debt deal with Aeolus Kenya.

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