Kenya has accepted a $907 million proposal from Adani Energy Solutions, the power distribution division of the Adani Group in India, to construct transmission lines and substations in the nation’s eastern and western regions.
Under a public-private partnership, Adani Energy Solutions, which manages more than 21,000 km of power distribution lines, will construct 5 substations and 371 km of lines.
The arrangement was made in response to public outrage over the specifics of a previous agreement with Adani Airport Holdings to run and repair Jomo Kenyatta International Airport (JKIA).
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The project development or feasibility study report, a crucial milestone in the project’s lifecycle, was completed and submitted in May 2024.
Following a thorough review, the report received approval, paving the way for the project to advance to the next stage – contract negotiations.
This significant progress was highlighted in the Treasury’s draft Budget Policy Statement (BPS), outlining the project’s evolution and future trajectory.
Transforming Kenya’s Infrastructure through Adeni Power Transmission Project
The Adani power transmission project is a key component of a comprehensive overhaul aimed at modernising Kenya’s outdated distribution infrastructure.
The primary objective of this initiative is to replace the country’s ageing distribution lines, which inefficiencies and unreliability have plagued.
By revamping the existing infrastructure, the project seeks to minimise energy losses, commonly called ‘leakages’, and significantly reduce the frequency and duration of power outages that have long plagued the country.
This upgrade is expected to enhance the overall efficiency, reliability, and sustainability of Kenya’s power supply, ultimately benefiting households, industries, and the economy as a whole.
With government funding for new roads, power lines, railroads, and airports being reduced due to increasing debt, Kenya has resorted to PPPs for infrastructure projects. Still, concerns have been raised about the process’s transparency and the exorbitant prices of some of the projects.
For example, the Kenya Airports Authority (KAA) verified the $1.85 billion JKIA concession in a local newspaper advertisement after President William Ruto denied knowing about it.
Under the terms of the JKIA agreement, the Adani Group’s hospitality division will have a 30-year concession of the nation’s principal airport, which Kenya has not renounced despite public criticism.
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Adani’s Group recovery: Overcoming fraud accusations and securing new investment
One of Asia’s wealthiest men and the creator of the Adani Group, Gautam Adani, has been eager to grow his infrastructure business into new markets as damaging accusations of corporate fraud fade. Hindenburg Research said the business participated in “brazen” fraud and market manipulation in 2023.
Adani’s listed stocks crashed following a $140 billion sell-off due to the accusations, which the firm refuted. Since then, the stocks have gone up.
The business announced on Monday that it had raised $1 billion in the first share sale since the crisis, with offers coming in from US investors.