The United Bank of Africa (UBA) has given Kenya Power Company a $10million loan facility to upgrade its infrastructure to distribute 5,000MW by 2017.
The $10mn loan facility from the bank is expected to boost the capacity of the power company’s transmission lines.
According to Kenya Power, the facility is part of a syndicated loan from a number of lenders to finance the planned infrastructure expansion. The company is Kenya’s sole power distributor.
The company said in a statement that the financing would be used to boost the capacity of transmission lines, upgrading existing substations and constructing 37 new ones, while also installing new equipment in the power grid.
“Completion of these capital investments on time is critical for long-term viability of our company. It will also make Kenya attractive as an investment destination,” said Kenya Power Managing Director, Ben Chumo.
“In the recent past, industrialists have complained of power outages occasioned by aging infrastructure, leading to increased cost of production as companies have been forced to install stand-by generators. This has made locally produced goods less competitive in the regional markets.
UBA, whose parent firm is in Nigeria, entered the Kenyan market five years ago and has now ventured into financing the local power sector. We remain committed to a continued relationship with Kenya Power and other key players in the public sector to take on similar or larger projects especially in energy and the infrastructure sector,” noted the Chief Executive of UBA Kenya, Isaac Mwige.
The bank has operations in 19 African countries and has international offices in New York, Paris and London.
