Kenya to Recoup Cash Paid to Africa's Largest Wind Plant
(Bloomberg) -- Kenya will recover 46 million euros ($53 million) paid to Lake Turkana Wind Power Ltd. after a government agency missed a deadline to build a transmission line to connect the company’s plant to the national grid.
The East African nation’s government will redeem the money from electricity consumers at a rate of 0.845 euro cents per kilowatt hour over six years from this month, Director Rizwan Fazal told reporters Monday in the Kenyan capital, Nairobi.
Recovery of the payment, including an adjustment for inflation, will increase the tariff to 8.53 euro cents per kWh from 7.52 per unit for six years, Fazal said in an interview.
LTWP, as the company is known, repaid 127 million euros for project loans last year, Fazal said. The payment included 46 million euros from the government and 81 million euros from the company’s shareholders. They intend to recover their portion after the government recoups its contribution, Fazal said.
“We did not renegotiate with lenders despite delays,” he said. “There was no chance to renegotiate. It would have destroyed the credit worthiness of the project.”
The power plant, which has a capacity to generate 310 megawatts, is Africa’s biggest wind farm and is located in Loiyangalani in northwestern Kenya. It was scheduled to become operational in October 2016 when the Kenya Electricity Transmission Co. was expected to complete a 436-kilometer (271-mile) line. All 365 turbines will be connected to the grid by the end of this month, LTWP Chairman Mugo Kibati told reporters.
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