OPIC and Kipeto Energy Sign Financing Agreement to Bring New Wind Power to Kenya
Tuesday, July 28, 2015
As part of President Obama’s Power Africa initiative, the Overseas Private Investment Corporation (OPIC), the U.S. Government’s development finance institution, today committed $233 million in debt financing to support construction and operation of the Kipeto Wind Power Project in Kajiado, Kenya.
The 100-megawatt, grid-connected wind power facility located south of Nairobi will be, when complete, one of the first utility-scale wind projects to come online in Kenya, where over 75% of the population still lack access to reliable electricity. Situated in an area with strong, consistent wind currents, the Kipeto project will provide cleaner and more reliable energy to Kenya’s national grid, helping to further bolster the country’s growing economy.
Elizabeth Littlefield, President and CEO of OPIC, signed a commitment letter of OPIC’s debt finance support alongside Jurie Swart, CEO of African Infrastructure Investment Managers. Littlefield was in Nairobi with President Obama as part of the U.S. delegation to the 2015 Global Entrepreneurship Summit.
OPIC’s financing to the Kipeto Wind Power Project also demonstrates the institution’s continuing role in fulfilling President Obama’s Power Africa initiative, which seeks to add more than 30,000 megawatts of cleaner, more efficient electricity generation capacity as well as increased power access with 60 million new connections throughout sub-Saharan Africa.
The Kipeto project is being developed in partnership with African Infrastructure Investment Managers (AIIM), one of Power Africa’s 100 private sector partners and fund advisor to African Infrastructure Investment Fund 2, Kenyan independent power producer Craftskills Wind Energy International, Ltd, and the International Finance Corporation. Craftskills initially began development of this project in collaboration with General Electric in 2010.
“Kipeto is a transformative project for many reasons, principally for the clean and reliable energy it will supply to Kenyan citizens,” said Elizabeth Littlefield. “It will be one of Kenya’s first utility-scale wind projects and can contribute more than 20 percent of residential power consumption at current usage rates. Our commitment to Kipeto is also a significant step in OPIC’s pledge to President Obama’s Power Africa Initiative. OPIC is proud to support the Kipeto project and its role in advancing Kenya’s economic prosperity.”
“Power Africa’s support of this important energy project reflects the United States’ ongoing commitment to scale up access to electricity and mobilize investment in Kenya,” said U.S. Ambassador to Kenya Robert Godec.
OPIC is the U.S. Government’s development finance institution. It mobilizes private capital to help address critical development challenges and in doing so, advances U.S. foreign policy and national security priorities. Because OPIC works with the U.S. private sector, it helps U.S. businesses gain footholds in emerging markets, catalyzing revenues, jobs and growth opportunities both at home and abroad. OPIC achieves its mission by providing investors with financing, political risk insurance, and support for private equity investment funds, when commercial funding cannot be obtained elsewhere. Established as an agency of the U.S. Government in 1971, OPIC operates on a self-sustaining basis at no net cost to American taxpayers.
All OPIC projects adhere to high environmental and social standards and respect human rights, including worker’s rights. By mandating high standards, OPIC helps raise the industry and regional standards of the countries in which its projects operate. OPIC services are available for new and expanding business enterprises in more than 160 countries worldwide.
About Power Africa:
In Kenya, Power Africa is supporting the development of the energy sector through financing, grants, technical assistance, and investment promotion. Power Africa is also mobilizing over $1 billion in private investment tied to accelerating the development of geothermal and wind projects. Power Africa’s Grid Management Support Program is helping Kenya take on and effectively manage renewable energy. Two years after its launch, Power Africa has helped transactions expected to generate over 4,100 megawatts of new, cleaner power generation throughout sub-Saharan Africa reach financial close.