Financing for Kinangop power project penned

December 3, 2013
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The Sh13 billion project comprises construction, financing, operation and maintenance of the project, located in the Kinangop region, about 60 kilometres northwest of Nairobi/XINHUA FILE
The Sh13 billion project comprises construction, financing, operation and maintenance of the project, located in the Kinangop region, about 60 kilometres northwest of Nairobi/XINHUA FILE
NAIROBI, Kenya, Dec 3 – The African Infrastructure Investment Fund 2 (AIIF 2) and Norfund, the Norwegian Investment Fund for Developing Countries, have concluded a deal to both finance the 60.8 megawatts Kinangop Wind Park project (KWP).

The Sh13 billion project comprises construction, financing, operation and maintenance of the project, located in the Kinangop region, about 60 kilometres northwest of Nairobi.

It will involve the installation and operation of 38 wind turbines, each of which has a rated output of 1.6 MW.

The turbines are designed to have a lifetime of 20 years.

Kinangop Wind Park is the first independent large-scale wind farm in East Africa and a landmark transaction for both the African power sector and the project finance market.

AIIF2 is a majority owner in the project company, Kinangop Wind Park Limited (KWP) while Norfund owns the remaining shares.

The two investors teamed up with project developers, Aeolus Kenya Limited, in 2012 to support them in bringing the project to financial close.

Through their investment, AIIF2 and Norfund plan to promote sustainable and environmentally friendly electricity generation in Kenya.

The mandated lead for the arrangement of the project debt is CfC Stanbic bank, which has also underwritten the full debt requirements of the project.

It will be built by Spanish construction company, Iberdrola Ingenieria y Construccion, which will install the 38 General Electric 1.6MW wind turbines.

KWP will sell electricity to the Kenya Power under a long-term power purchase agreement.

The project will start feeding electricity into the grid in the first quarter of 2015 and full commercial operations are expected to commence in July 2015.

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