Kenya has struck a deal with Lake Turkana Wind Power to defer the monthly fine of US $10m as a penalty for delaying to connect the wind power to the national grid.
The wind farm which has already fined Kenya US $50.7m, held talks with the government and reached a consensus of suspending the penalty until September 1st to facilitate completion of the transmission line project.
The delays from the government side was caused by a closure of a major contractor and late land owners’ compensation. This in turn led to delays in construction of Kenya has s the 428-kilometre power line, hampering electricity evacuation from the northern town of Marsabit to Suswa substation in Narok, the country’s main interchange for power coming from different sources
“We as the government, the power transmission line financiers and the Lake Turkana Wind Power have a new contractor on site as the former one disappeared and we have put all government agencies on high alert to facilitate its fast-tracking to beat the August 31st deadline, ”said Mr. Charles Keter, the Energy Cabinet Secretary.
The new contractors are, NARI Group and Power China Guizhou Engineering Company.
The deal is a relief to consumers bearing a record of electricity prices following the use of expensive diesel generators due to bad weather which has affected the hydropower industry. Homes consuming 200 units of power paid a record high of US $42 this year, up from an average of US $37 year last year and US $30 in 2013.
On completion, the wind farm will provide 310MW of reliable, low cost energy to Kenya’s national grid, approximately 15% of the country’s installed capacity; which will be bought at a fixed price by Kenya Power over a 20-year period in accordance with the Power Purchase Agreement.