Kenya is seeking to secure a loan of $150 million from the African Development Bank to continue its efforts to power homes with electricity.
This loan will be utilized in the third phase of the Last Mile Connectivity project, which aims to connect an estimated 150,000 homes in 45 counties to the power grid across the country.
The Last Mile Connectivity initiative was initiated by Kenya Power in 2015 with the goal of linking homes near transformers to electricity at subsidized rates. The objective is to achieve universal electricity coverage in the country. Despite concerns over the financial sustainability of this project, it has proven successful in expanding Kenya Power’s customer base to over nine million.
The Government of Kenya has applied to the AfDB for the $150 million loan, which will be instrumental in purchasing 1,316 new transformers and extending the high voltage and low voltage networks by 650 kilometers and 6,798 kilometers respectively. These upgrades will significantly enhance the reach and reliability of the electricity distribution network.
If approved, this funding will supplement the financial support that Kenya Power has already received from three multilateral lenders. These funds have been utilized to connect 280,473 households across 32 counties to the power grid. The additional loan from the AfDB will substantially contribute towards achieving the goal of providing electricity to a larger number of households.
The Last Mile Connectivity project has been crucial in improving the standard of living for many Kenyan citizens. Access to electricity brings numerous benefits, including improved lighting, increased productivity, and expanded opportunities for education and entrepreneurship. By connecting more homes to the power grid, Kenya is taking a significant step towards rapid socio-economic development and poverty alleviation.
Furthermore, this project is aligned with the Kenyan government’s ambition to achieve Sustainable Development Goal 7, which aims to ensure access to affordable, reliable, sustainable, and modern energy for all. Electrifying homes across the country is a crucial element in achieving this goal.
In order to further enhance and expand electricity access in the country, the power distributor successfully secured a substantial loan of €90 million from the renowned French Development Agency. Additionally, they also received a generous grant of €30 million from the European Union, further demonstrating the commitment and support from international partners.
The European Investment Bank also played a pivotal role in this endeavor by providing the power distributor with an additional loan of €60 million in May. These financial resources will play a crucial role in funding the upcoming third phase of the Last Mile programme, scheduled to commence in November.
The implementation of this phase is estimated to take approximately five years to complete, as stated by AfDB. Under this groundbreaking programme, the government and its esteemed development partners will collaboratively shoulder a portion of the connection costs for homes, ultimately alleviating the financial burden on households and fostering greater access to affordable electricity.
This initiative highlights the significant strides taken to ensure sustainable and inclusive development in the energy sector and underscores the commitment of multiple stakeholders in addressing the pressing challenges of energy poverty in the country.
