Indian billionaire Gautam Adani's energy firm pushes on with transmission deal in Kenya

Omokolade Ajayi -
Key Points
  • Kenya Electricity Transmission Co. says discussions with Adani Energy Solutions on power lines are ongoing, contradicting earlier finalization claims.
  • Adani Energy’s bid for Kenya’s power transmission lines was revised to $736.5 million from an initial $1.01 billion last year.
  • Kenya faces a $5-billion gap for new power lines amid ongoing national outages, highlighting the urgent need for infrastructure improvements.

The Kenya Electricity Transmission Co. (Ketraco) has confirmed ongoing discussions with Adani Energy Solutions, a subsidiary of Adani Group conglomerate led by India's second-richest man Gautam Adani, for the construction of three high-voltage power transmission lines. 

This clarification comes after a presidential adviser previously suggested that deals worth up to $1.3 billion had been finalized.

Ketraco CEO John Mativo clarified on Monday that despite Adani Energy Solutions' interest, no formal agreement has been reached. "There are still many boxes to tick," Mativo said during a meeting with stakeholders in Nairobi. "We will get the best deal for this country."

Proposed deal details and revised costs

Adani's initial proposal last year aimed to construct 388 kilometers (241 miles) of high-voltage transmission lines for an estimated $1.01 billion. However, Ketraco’s project development head, Anthony Musyoka, noted that the bid was recently revised to $736.5 million.

Urgency amid power infrastructure gaps

Kenya faces a $5-billion financing gap for new power lines, requiring $250 million annually. National outages this year have highlighted the urgency for improved infrastructure. Mativo emphasized that while the national grid has seen improvements, it remains inadequate.

Adani’s proposed plan includes a 206-kilometer line connecting Gilgil, Thika, Malaa, and Konza; a 95-kilometer Rongai-Keringet-Chemosit link; and a 98-kilometer Menengai-Ol Kalou-Rumuruti conduit.

Negotiations are ongoing over debt costs and equity returns, with Adani seeking an 11.5-percent debt cost and a 16 percent equity internal rate of return, while Ketraco aims for a 9.5-percent debt cost and a 14-percent return.

Gautam Adani’s global infrastructure expansion

Gautam Adani, India’s second-richest man with a net worth of $101 billion, continues to drive global growth for the Adani Group. The group's diverse portfolio includes Adani Power, Adani Total Gas, Adani Energy Solutions, Adani Ports, and Adani Green Energy.

Adani Group's strategic expansions reflect its commitment to a robust global presence, including a $1.22-billion investment in Kenya’s power infrastructure through a partnership with Africa50, an investment platform of the African Development Bank.