The firm is currently raising Sh28.8 billion through a Rights Issue with the government already taking up three million shares valued at Sh20.2billion/FILE
NAIROBI, Kenya, Jun 28 – The Kenya Electricity Generating Company (KenGen) requires Sh1trillion to add some 2.5GW to the national grid in the next 10 years.
This comes as Kenya is gearing itself toward a forecast of over 5GW by 2030.
KenGen Chairman Joshua Choge has long sought to free the government from the yoke of sovereign guarantees by identifying other financing options such as the public infrastructure bond, funding projects from cash flows and most recently, the ongoing Rights Issue.
The firm is currently raising Sh28.8 billion through a Rights Issue with the government already taking up three million shares valued at Sh20.2billion.
They are issuing a total of 4.4billon shares, representing an entitlement ratio of two for every one share held, at a price of Sh6.55.
The Rights Issue opened on May 23 2016, with closure on June, 10 2016.
Listing and commencement of trading of new shares at the NSE will be on 6 July 2016.
With the additional capital, KenGen plans to commission an additional installed capacity of about 720Megawatts (MW) mainly from affordable, clean and environmental friendly sources. At the moment the power generator’s installed capacity is 1,618MW (1.6GW).
Among the projects lined up is the drilling programme for 140MW Olkaria VII, which is scheduled for delivery by 2020.
The company also expects to complete 25MW of early generation geothermal wellhead project by June 2016, bringing the total capacity on wellhead generation to 75MW.
The 140MW Olkaria V and 80MW Meru Wind phase I are expected to come on stream in 2018 and have already attracted funding from development partners, including the French Development Agency (AFD).
“I must admit that our appetite has been whetted and we cannot wait to power up another 430MW in the next three years, we want to assure the nation that KenGen is up to the task and using avenues such as this to deliver that promise,” Choge said.
KenGen is the leading electric power generation company in Kenya, producing about 80 percent of electricity consumed in the country.
The company utilises various sources to generate electricity ranging from hydro, geothermal, thermal and wind.
“One of the government’s primary policy objectives is cost reduction, and this was one of the driving forces behind the plan to lower the electricity tariffs by 2017. Tariffs can only improve on the back of reduced operational costs by cutting out waste while maintaining high availabilities. Looking at our local value chain, there is a lot of room for improvement. We must steadily identify efficiencies and wastes across the generation, transmission and distribution channels to enable us lower electricity tariffs,” he stated.
Choge spoke on Tuesday during the launch of the 4th edition of the company’s annual technical seminar.
