The Homa Bay County government has signed a Sh12.6 billion (USD 150 million) deal with a consortium of Canadian firms in its bid to end power shortage in the area.
The Memorandum of Understanding signed in Homa Bay on Thursday will see the firms trading as Lakeside Solar developing 50 megawatts of solar power in the area within the next one year. Lakeside Solar is a consortium of Canadian Exporters and engineers which includes Africa Energy Development Corporation, Eaton Cooper Solar Canada and Canadian Solar.
Governor Cyprian Awiti said the project plans to increase the energy available to the grid besides generating revenue for the county. We have enough land which we are going to provide for construction of this project to enhance the lives of our people, Awiti said. He said the project once completed would solve the frequent power shortages in the county.
Mr Zohrab Mawani, an official of the consortium said Lakeside Solar chose Homa Bay county, Kenya because of its good reputation overseas as an investor friendly region. Lakeside Solar is ready to work with the county to explore optimal terms and options for financing the construction of the plant to enhance, demystify obstacles in the areas energy sector, said Mawani. He added that the plant is expected to generate up to 100 million kWh of electricity per year which will be sold to the Kenya Power Company at an average tariff of USD.12 cents with USD 0.16/kWh for the first ten years and USD 0.80/kWh thereafter for ten years. The useful life of the plant is estimated at 25 years, according to experts. Mawani said the loan against the asset would be paid off in 12 years leaving the county with a loan free asset for a period of 13years.
Transfer ownership Rural Electrification Authority (REA) will take the role of the owner on behalf of county and develop this project through a commercial contract, said the official. Upon successful commission, Rea shall transfer the ownership of the project to the county of Homa Bay.
The project is expected to create more than 100 job opportunities for the residents. Members of the Homa Bay County executive committee who also signed the contract documents-Nicholas Koriko (Finance and planning) and Pharesh Ratego (Energy and Natural Resources) described the project as viable.
