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Kenya Power signs PPA with Ethiopian Power Producer

On 28th July 2022, the Kenya Power and Lighting Company Plc (Kenya Power) and Ethiopian Electric Power (EEP) signed a Power Purchase Agreement (PPA) to actualize power trade between the two countries, effective 1st November 2022. Under the 25-year PPA, Kenya will buy 600 Megawatts (MW) from EEP, with the maximum capacity being 200 MW in the first three years and 400MW in the remaining years. This will make EEP will the second largest power supplier to Kenya Power after KenGen.

The power from EEP is expected to cost between Sh6 and Sh7 seven cents a kilowatt hour which is lower than the average of Sh10 a kilowatt hour offered by power producers in the country While the new deal between Kenya Power and EEP will augment ongoing reforms in the energy sector to reduce power tariffs, it will result in increased competition owing to a new entrant in the market space.

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