The African Development Bank (AfDB) has withdrawn multi-billion shilling funding for a 35-megawatt geothermal power plant in Menengai, Nakuru after it was revealed that Baringo Senator Gideon Moi‘s has a stake in the plant.
AfDB has demanded change of ownership before funding the Sosian Menengai Geothermal Power which is one of the three firms that was awarded rights to set up a steam plant under a build own operate model by government owned Geothermal Development.
KBF has learnt that Mr Moi bought back majority of the shares in Sosian from steel and cement tycoon Narendra Raval. Moi has been expanding his family business empire through his links with the government of the day and he is the key financiers of Azimio La Umoja candidate Hon Raila Odinga who is expected to face off with DP William Ruto in August polls.
The family which has accumulated to wealth that is running into billion is hellbent to join forces with Kenyatta family in ensuring that Ruto does not ascend to power but Mr. Odinga who has been labeled President Uhuru Kenyatta’s puppet.
The Moi family has been in the country’s leadership since independence but without attractive record of development even in their backyard in Baringo but are using their power to capture every lucrative business as they battle with Ruto who has dislodged them as political supremo in the Rift Valley region.
Moi coerced Raval sell back the firm to him after endless delays in building the power plants which remain far from completion almost a decade after they won the contract.
“The delays have primarily been due to negotiation of the finance documents between the lenders and sponsor, closure of certain bankability issues with the government agencies and change in the sponsor of the project.” Read part of the AfDB statement.
It was further revealed that AfDB pushed for ownership changes in QPEA, which prompted British firm Globeleq to buy a majority of shares Sosian Menengai in February last year.
Menengai Sosian Geothermal is one of three independent power producers (IPPs) developing the 105MW Menengai geothermal project. AfDB’s withrdrawal is a major setback is to the government which wants to rely on geothermal to power cheaper fuel development.
Kenya’s geologically active Rift Valley forms the cornerstone of government’s quest to improve energy production with a potential of 7,000 megawatts.
Reason as to why AfDB is not interested in partnering with the wealthy Moi family remains unclear. The family amassed wealth from public coffers before after their father was president for 24 years with businesses that play a major role in the economy.
The family is keen on having their hands firm on the next government to neutralize DP’s political influence and expand their Business Empire which spans from real estate, transport, education, hotels, banking, aviation, manufacturing, media, agri-business, security and construction. Gideon Moi also owns Sosian Geothermal with his son Kigen Moi and Anastacia Kioko Mululu listed as directors.
Ms Mululu is a former partner at Mutula Kilonzo and Co Advocates, which provided legal services to former President Daniel Moi for decades.
AfDB withdrawal is also a major blow Kenya is banking on geothermal and wind as source of clean and cheaper energy to lower the cost of electricity from the current average of Sh20 per unit for domestic households.
Mr Raval’s, popularly known as Guru bought the Sosian stake in 2017 was aimed at pacifying AfDB and underlined the lucrative nature of Kenya’s energy sector, which continues to attract tycoons.
Kenya’s energy rules stipulate that Kenya Power which is the only electricity retailer must sign 20-year power purchase agreements (PPA) with power producers, offering comfort to private investors to recoup their investments.
Guru had claimed that the investment in the geothermal power plant would top Sh8.2 billion as he set its groundbreaking in March 2017 but up to now the construction remains behind schedule with uncertainties about when it will inject electricity to the grid.
Ormat Technologies and Quantum Power which are listed at the New York Stock Exchange are the two other firms selected to build a 35MW steam power plant each on a public-private partnership basis.
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