Since the beginning of the year, a number of financial organizations have announced funding arrangements with the country to this end.
The most recent entrant, the European Investment Bank (EIB), announced that it would give a Sh7.5 billion loan this year for the construction of two solar power plants, underlining the growing interest by global organizations to finance local green projects.
The bank said the €60 million (Sh7.5 billion) credit line would go to Radiant Energy and Eldosol Energy, which are owned by the same developers, and whose solar projects are located next to each other in Eldoret. The two parks have a capacity of 40 megawatts each.
The solar plants will be connected to the national power grid. The electricity will cost Sh12.36 per unit under Kenya’s feed-in-tariff for solar power.
EIB East Africa head Catherine Collin said “The financing will be finalized soon,”
EIB records show that the construction of the two farms will cost Sh17.6 billion.
This means the Sh7.5 billion loan will cover only part of the expenses, so the developers will raise the remaining Sh10.1 billion through other avenues, including equity.
Meanwhile, solar energy systems maker Orb Energy on January 18 announced $1million (Sh103million) in financing as part of the efforts to promote the expansion of renewable energy in Kenya.
The company said it had raised the money to grow its in-house finance facility, which helps small and medium-sized enterprises buy rooftop solar systems.
It aims to provide finance to potential users looking to reduce electricity costs both at home and in their businesses by acquiring a rooftop solar system.
The company said that Participatory Microfinance Group for Africa (Pamiga), an African finance institution and an initiative of France-based International NGO Centre for International Development and Research (CIDR), provided half the amount while Germany’s development finance institution, DEG, provided the rest.
The money will be used to boost its residential and commercial solar business in Kenya, where it began operating in 2014. Since then, it has invested more than $2.million in the country.
Orb, which manufactures solar panels, solar water heating systems, and also does installations, has sold more than 10,000 solar systems in the country since 2014, the company CEO said.
