CfC Stanbic Bank signs deal with Aeolus Kenya to build $150 million wind power plant in Kenya

This new power plant is expected to be the largest wind power generation project in sub-Saharan Africa to date outside of South Africa. Built in Kinangop and expected to come on line in mid 2015, it will add a further 60 MW to Kenya’s 1,672MW national power grid providing electricity to 150,000 homes.

Aeolus Kenya (AKL) is a member of the Power Africa initiative led by the United States President Barack Obama which is developing 1 gigawatt of wind, geothermal and gas fired power projects in the East African region.

According to Richard Herbert, chief executive and director and Jenny Fletcher managing director in their joint statement, “The development of this large scale wind park has been a challenging and rewarding process and we look forward to continuing our strong relationships with the Kenyan Government.”

Kwame Parker, CfC Stanbic Bank’s East Africa Head of Debt Solutions and Infrastructure Finance, says that the transaction will be fully funded through a combination of debt and equity.

Standard Bank, CfC Stanbic Bank’s parent bank, is the lead arranger and will underwrite Sh7.74 billion ($90 million) of the debt, while Norway’s Norfund and a large Africa-focused international infrastructure investor will provide Sh5.16 billion ($60million) in equity. Financial close is expected in the next three weeks and syndication of the debt is now underway.

“With the rising demand for electricity in Kenya, this project will go a long way in providing cost-effective power to the economy. It is a good example of how to successfully bring private players into the renewable energy sector and serves as a good vote of investor confidence in the Kenyan economy,” Parker said.