by Ronald Njoroge
NAIROBI, Aug. 28 (Xinhua) -- African Development Bank (AfDB) is in talks with investors to fund the construction of Kenya's Chinese-backed coal power plant, bank officials said on Monday.
AfDB Director-General of the East Africa Regional office Gabriel Negatu told Xinhua in Nairobi that they are awaiting the environmental and social audits before they can release the funds.
"The owners of the 1000 MW Lamu coal plant have approached AfDB for funding to the tune of 100 million U.S. dollars as well as guarantees of a similar amount for the construction of the power plant," Negatu said on the sidelines of the First Regional Dialogue on WTO accessions.
The Lamu coal plant will be developed by a consortium called Amu Power that includes Centum Investments, Gulf Energy, Sichuan Electric Power and Design and Consulting, China Huadian Corporation Power Operation Company and Sichuan No.3 Power Construction Company.
Amu Power has commissioned China Power Global to construct the two billion U.S. dollars power plant. AfDB typically provides funding of between 10 and 20 percent of a project.
Negatu said that that they are funding the coal power plant because it is a low-cost energy source especially given the country's huge coal resource.
"In addition, the power plant will use the latest technology to ensure that its impact on the environment is minimal," he added.
The project finance is part of the pan African bank's New Deal on Energy where it has set aside ten billion dollars to enable the continent to achieve universal electricity access by 2025.
"Kenya will be one of the beneficiaries of the pool of resources," the director said.