Kenya has officially signed a power deal with India's Adani Energy Group, worth Ksh95 billion, to construct 422 kilometres of vital transmission lines despite opposition.

Energy Cabinet Secretary Opiyo Wandayi on Friday, October 11, announced the agreement, which according to him, marks a huge shift in the power transmission across the country.

The contract, finalised on October 9, 2024, comes after four months of intense negotiations, during which the Adani Group faced scrutiny regarding its operational practices. Wandayi expressed his satisfaction, stating, “This agreement marks the beginning of a transformative initiative to develop, finance, construct, operate, and maintain key transmission lines and substations across Kenya.”

Despite concerns surrounding the Adani Group, which has been embroiled in various controversies, Wandayi has defended the partnership, highlighting the critical need for enhanced electricity infrastructure to support Kenya’s burgeoning economy. He reiterated, “Kenyans are well aware of the significant challenge that our country faces with persistent power blackouts.

Details about the agreement remain scarce, as KETRACO has opted not to disclose specifics. The project's cost, estimated at Ksh95.68 billion (approximately USD 736.51 million), will be financed through a combination of debt and equity raised by the Adani Group, with repayment expected over a 30-year period.

Wandayi assured that a competitive bidding process would ensure value for money, with a focus on prioritising local content to foster business opportunities for Kenyans.

However, financial implications loom large, with reports indicating that the Adani Group may seek Ksh634.7 billion (USD 4.92 billion) from Kenyans over the next three decades. This raises concerns about potential increases in electricity prices as the conglomerate seeks to recover its investment. The government is under pressure to clarify how this financial burden will affect consumers, especially in a nation where many already struggle with high living costs.

The deal involves the construction of three high-voltage power transmission lines and two substations, strategically located to enhance connectivity and stability in the national grid. The 400kV Gilgil-Thika-Malaa-Konza line will stretch 208.73 km and feature new substations in Gilgil, Thika, and Malaa. Meanwhile, the 220kV Rongai-Keringet-Chemosit line, covering 99.98 km, will establish additional substations at key locations, including Rongai and Keringet.

According to Wandayi thorough stakeholder engagement was conducted before finalising the agreement to ensure all concerns were addressed. This proactive approach aims to foster trust among Kenyans regarding the Adani Group's involvement.

The signing of the deal comes as it emerged that the group is laying the groundwork to expand its ventures into Kenya, with a new plan to construct hydroelectric plants.

According to Reuters, Adani is keen to tap into Kenya's untapped potential, eyeing favourable topography and hydropower demand. Yet concerns linger over the group’s controversial reputation and its dealings in the region.