The Cotonou Agreement between the European Union (EU) and the African, Caribbean and Pacific Group of States (ACP), was signed for a 20 year period in 2000. It has been the framework for the EU’s relationship with 79 countries in these three regions and is aimed at eradicating poverty while contributing to the sustainable development of the member’s economies. Another one of its main aims is to integrate ACP countries gradually into the world economy.

The European Development Fund (EDF) is the EU’s main financial instrument for providing development aid to ACP countries. It has a budget of €30.5 billion for the period 2014 – 2020. It mainly funds projects in the fields of economic development, social and humanist development and also projects that encourage regional cooperation and integration and invests in projects that explicitly target increasing the share of energy generated from green sources, sustainable infrastructure and helping the countries such as Kenya gain more food security and become more resilient to climate shocks especially in the Arid and Semi-Arid Lands.

As part of the 11th EDF National Indicative Programme for Kenya aiming to implement Kenya’s Vision 2030 plan, the EU is funding the construction of two 40MW net output solar photovoltaic (PV) power plants near Eldoret, Western Kenya. Vision 2030 is the Kenyan government’s plan “to create a globally competitive and prosperous nation transforming Kenya into a middle-income country providing a high quality of life to all its citizens by 2030 in a clean and secure environment.”

The two power plants are being developed independently under the feed-in tariff regime in Kenya. The two projects will supply electricity to the national grid and have shared facilities.

Work on a new solar plant in Garissa, a town in the north east of Kenya has recently begun. China Jiangxi has the contract to build the plant using a $135.7 million loan from China’s Exim Bank. Kenya Power has signed a power purchase agreement with The Rural Electrification Authority (REA) to but the electricity at a third of the cost of its diesel generated power. It will also cut Kenya’s carbon emissions by about 43,000 tons a year.

Kenya has over 300 days of sunshine a year and companies setting up solar farms include UK firm Solarcentury, Green Energy Africa and Greenmillenia Energy Ltd.

Kenya has been a solid performer in Africa and has become a low to middle income earning country and plays an important part in the development of East Africa. Of the €30.5 billion in the EDF the investment in Kenya will amount to €435 million in the 2014 – 2020 cycle.

Cornfield & Partners can help you look investing in solar energy in Kenya and globally.
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