The African Development Bank (AfDB) has warned that Kenya Power’s Last Mile Connectivity Project, which links homes to the national grid under a subsidized agreement, is grappling with a budget hole that risks delaying it.
The multilateral lender that has bankrolled the plan in the past has not identified a real funding deficit, but has warned that there is an urgent need for the government to address the shortfall.
“As the sum of contract price has exceeded the total estimated project cost, the Government of Kenya contribution has to be increased or supplementary finance has to be requested to avoid delay on payment to contractors,” AfDB says in an audit update for the project.
“Therefore the government has to increase the counterpart fund or request for supplementary financing to complete the project.”
According to Nation Africa, the project seeks to expand the low voltage system throughout the county so that counties with low penetration rates of electricity benefit the most. Around 300,000 customers are expected to be connected to the latest phase of the project, leading to access to electricity for about 1.5 million Kenyans under the agreement.
In its latest annual report, the electricity distributor says that 306,771 customers under the project have been connected to the grid.
“In working towards achieving universal access to electricity, the company continued to implement the last mile connectivity and transformer densification projects supported by the government and other development partners,” Kenya Power says.
“During the year, a total of 197,971 customers were connected under the last mile project and 466 new single-phase distribution transformers were installed along existing distribution lines under the transformer densification project. This contributed to increase in the number of customers connected by 306,771.”
Depending on their proximity to power lines and transformers, the project had previously seen power consumers get connected at a subsidized rate of Sh15,000, down from Sh35,000. Beneficiaries are strictly homes with a transformer located within 600 meters.
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