The Excuse That We Are Using PPPs in Adani Deals Because We Don't Want to Burden Kenyans With Debt.

The excuse that we are using PPPs in Adani deals because we don't want to burden Kenyans with debt is highly misleading. Whichever financing mechanism is used for any public project, it is Kenyans who will eventually pay for it. 

The worst thing about PPPs is their long-term nature committing generations to years of exploitation. The absurdity of Adani's PPPs is that we are using a broker to do what KETRACO has always done. What is the point of borrowing a loan through Adani and yet the loan will be repaid by Kenyans through power bills? Why can't KETRACO take the loan and receive the payments from Kenya Power over a much shorter period? 
Those of you who followed my expose of IPPs will remember that IPPs are paid many multiples of what KenGen is paid for the same source of power. If KenGen were paid at the same rate as IPPs, it would construct all power projects in the country using its balance sheet. 

In the year ended June 2023, KETRACO earned KSh 2,970,101,000 as wheeling charges from its 5,476 km of transmission lines. This represents a yield of KSh 542,385 per km. Yet we are told Adani will be paid KSh 21 billion annually for 372 km of transmission lines translating to KSh 56,451,612 per km. If KETRACO was paid at this rate per km, it would earn KSh 309 billion per year compared to the paltry KSh 3 billion it is currently getting from Kenya Power. This doesn't make any sense even if you exclude the cost of the substations. 
Without cost inflation through graft, the 372 km transmission lines Adani is constructing would cost KSh 22 billion assuming construction costs of KSh 60 million per km. Kenya Power sells about 10 billion units of power each year. If you charged KSh 2.5 per unit you would get KSh 25 billion in one year. This amount would be enough to construct these lines. 

Yet Adani through PPP will earn KSh 640 billion in 30 years. How can you pay KSh 640 billion over 30 years when you can easily raise the cost of constructing these lines in a year or two? All Kenyans would willingly pay the extra charge for power to evade this slavery. 

To make things worse, the lines Adani is constructing aren't even needed. All those places where these lines are being done have alternative routes from which they get power. The Adani lines are just for redundancy and supply of alternative power sources. There is no urgency or emergency to warrant constructing the lines now if we can't afford them. 

Even if we wanted to use a loan, there is no evidence that we have tried getting concessional financing for these projects and failed to do so. There is also no evidence that such a loan can't be repaid by increasing the wheeling charges paid to KETRACO. 

We are just trying to get out of the mess IPPs have put us through in the last 30 years. And now we want to get into a fresh mess by bringing independent power transmitters. How can we do this to ourselves and future generations because of the greed of a few people?

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