- Kenya Tea Development Agency (KTDA) has formed Chai Power Limited in a venture with renewable energy financier GridX.
- Chai Power’s renewable energy projects will be operated by KTPC and be developed and financed by GridX who have set aside US$10 million in financing for the first 12 MW of projects to be rolled out at tea farming operations in Kenya over the next two years.
- GridX will hold a minority share in the venture.
“Chai Power’s projects will deliver low-cost renewable energy for the benefit of Kenya’s tea farmers while expanding the asset base of KTPC and securing long-term stable cash flows for KTPC and KTDA,” said KTPC in a press statement.
“Chai Power leverages KTPC’s expertise in managing complex energy assets while creating a replicable structure that can rapidly deploy solar to KTDA factories and subsidiaries, without giving away ownership of the assets to a third-party Independent Power Provider. Deploying projects in this manner will allow KTDA factories and subsidiaries to access lower-cost renewable energy without having to use capital that can be better spent on core business purposes,” added KTDA.
“Electricity represents one of the largest cost-centers for each factory, increasing production costs and reducing the amount of cash available for farmers. Based on feasibility studies conducted on behalf of KTDA, deploying around 25 MW of solar across all 75 KTDA factories would create more than $2.5 million (Sh310 million) in annual saving,” the company concluded.
Author: Bryan Groenendaal
