By: Reuters

Kenya signed an agreement on Monday for a $311 million investment to construct two high-voltage electricity transmission lines with a pan-African infrastructure fund and PowerGrid Corporation of India, the finance ministry said.

The East African nation has increasingly turned to public-private partnerships and the securitisation of revenue streams to fund infrastructure projects, as high public debt and constrained fiscal resources limit traditional financing options.

Under the agreement, Africa50—a Morocco-based infrastructure fund primarily owned by African states—will partner with PowerGrid to design, finance, construct, and operate the transmission lines and associated substations, according to the ministry.

Africa50 stated that the project company would manage the entire lifecycle of the transmission infrastructure over a 30-year concession period, from construction through operation. The fund added that the two lines would "unlock cleaner, affordable, and more reliable power for millions of Kenyans."

The specific breakdown of the investment and the expected increase in transmission capacity were not detailed.

The state-owned Kenya Electricity Transmission Company Limited (KETRACO) will serve as the contracting entity. The finance ministry stated the project would enhance system stability, reduce technical losses and load shedding, and support the integration of renewable energy.

Historically, demand-driven overloads have triggered grid failures and nationwide blackouts. The government has aimed to address this by expanding infrastructure to accommodate growing demand without overburdening the network.

However, Kenya's significant debt burden and public resistance to tax increases have closed off conventional financing avenues. In response, President William Ruto's administration has pursued agreements with private sector partners.

Critics argue this strategy exposes the state to additional liabilities through non-transparent contracts, a claim the government has rejected.