Kenya's 300MW agrees PPA with KPLC

KENYA: After months of uncertainty, the developers of the 300MW Lake Turkana Wind Power project have signed a power purchase agreement with Kenya Power & Lighting Company (KPLC).

According to LTWP's deputy managing director Chris Staubo "all contracts and interfaces are in place". He expects LTWP to sign term sheets with lenders by the end of the month.

The project ran into problems late last year when the government decided not to issue sovereign guarantees to renewable energy projects. This made it impossible to secure financing.

The government has now resolved the deadlock by providing a "letter of comfort" reassuring lenders that it will assume the risk of KPLC and Kenya Electricity Transmission Company defaulting.

While less robust than a guarantee, the letter is acceptable to the World Bank and other international financial institutions, Staubo explained.

Local media reported that the first 50MW could be commissioned late 2013 and the full 300MW a year later.

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