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Lake Turkana Financial Instrument

Region
Eastern Africa
Sector
Energy
Scope
FI
Grant Amount
EUR 25,000,000
Total project cost
EUR 620m
Status
Fully disbursed
PFG Lead Financier
EIB
PFG co-Financier
AfDB, PIDG, COFIDES, FINNFUND

The Lake Turkana Wind Power project is the largest wind farm that is currently being developed on the sub-Saharan continent and will be one of the largest renewable energy projects in Africa. The wind farm, which will be located about 10 km east of Lake Turkana in northern Kenya in a sparsely populated, rocky, desert area, will include 365 turbines, a 33 kV electricity grid system, and a 33/200 kV substation, providing 310 MW of reliable, low cost wind energy to Kenya’s national grid. The wind farm will sell electricity to the national utility Kenya Power & Lighting Co. (KPLC) under a 20- year power purchase agreement and is being developed under Kenya’s Independent Power Producer programme, which is attracting private investors to the sector. Once completed, the project will initially account for up to 17% of the country’s installed capacity in a fast-growing, supply-constrained market. The project will contribute to addressing currently unmet and growing electricity demand using a renewable energy resource and will thus reduce the country’s dependence on imported fossil fuels and climate-sensitive hydropower, support economic development and avoid the environmental impacts of fossil-fuelled electricity generation.

As of January 2016, the project is in its final stages of construction (scheduled for September 2016). The financing documents, including the EU-AITF investment agreement, were signed in March 2014. 

The EU-AITF SE4ALL financial instrument grant will provide a capital participation to the project to close a financing gap and will hence remove a substantial hurdle to financial close. As a result, the grant brings direct benefits to the Kenyan end consumer by supporting a project that will deliver over 20 years of sustainable electricity supply at a favourable rate.

As of January 2016, the project is in its final stages of construction (scheduled for September 2016). The financing documents, including the EU-AITF investment agreement, were signed in March 2014.

12/2015