Monthly Archives: March 2014

Financing Lake Turkana Wind

Monday saw the signing of final agreements for the financing of the Lake Turkana Wind Power – LTWP project.

This was the completion of a long, 9-year process that began with a fishing trip on Lake Turkana, that yielded no fish, but a lot of wind on the boat trip. The LTWP which will generate 300 MW, using 365 turbines in Laisamis (Marsabit) was registered in 2006. Aldwych International  was brought on  as an investment and development partner in 2009.

The signing of finance deals worth 498 million euros (~ Kshs. 60 billion), will go towards LTWP which at Kshs. 75 billion is arguably both, the largest single wind power plant in Africa and, the largest single private investment in Kenya. 

The Kenya Government has committed to raising the country’s electricity generation capacity to 5,538MW (from the current 1,533MW) by the year 2017. 630MW of that will be from wind, and they have identified five strong wind areas in Ngong, Turkana, Kinangop, Kipeto, and Isiolo – and hopes that using renewable sources of energy like the wind will bring down the cost of electricity to consumers, and save on fuel import costs for the country. The government’s KETRACO agency will build a 428 kilometre, 400 kV line, from Loyangalani to Suswa Suswa to Laisamis that they say will be ready in 24 months and which will also link up with geothermal plants along the way.
Image from LTWP website

Financiers in LTWP include the African Development Bank (AfDB) who are the lead arrangers and who have provided a guarantee against some delays. The bank has also financed $1.7 billion in power generation in Africa, with 39% of that going to private sector companies. Others are the European Investment Bank. Standard Bank (Stanbic), FMO, Nedbank, EADB, PTA, PKF, DEG, Proparco and soon OPIC (US). Other partners in LTWP include Vestas (turbine supplier), the governments of Denmark (providing EUR 135 million including 120M in export credits), Netherlands, and Spain (who are financing the Laisamis- to Suswa transmission line).

Next, the Kenya government wants to expand the number of last-mile electricity connections while KETRACO also plans to extend the transmission lines to Northern and North Eastern Kenya – and on to Ethiopia, Tanzania and Uganda. This will serve the regional transmission purposes and also open up Northern Kenya. Joseph Njoroge, the Energy Principal Secretary, said additional electricity opens up opportunities such as enabling the pumping of crude oil, the possibility for electric trains to run on the Standard Gauge Railway, iron smelting, as well as clinker production (by Athi River Mining and Dangote).

edit October 2015: A deal by Google to buy shares from Vestas fell through in 2016.

edit March 2023. Some shareholding changes at Lake Turkana Wind Power as CPF UK Holdings to acquire a controlling 31.25% stake from other shareholders.

edit: The new investor buying out Finnfund, is the Climate Finance Partnership (CFP), a fund managed by BlackRock Alternatives. Finnfund, which was a shareholder since the construction began in 2014, exits after doubling its investments in “undeniably one of the best wind sites in the world” – that was built on time and on budget despite its size and remote location. Finnfund will continue to make more renewable energy investments, including a recent one in a geothermal power project in Nakuru County, Kenya.

WhatsApp to Replace Twitter as Kenya’s Corporate Darling?

This week, Nendo Ventures and OdipoDev published a Social MediaTrend Report that analyzed recent trends. These included usage and messages on  WhatsApp, Facebook, and over 5 million twitter Kenya messages sent in the last year that spiked during events such as the March 2013 presidential election, the Westgate Mall terror attack and the Kenya@50 independence celebrations. 
They made several predictions in the report which including three main ones:
1. WhatsApp will change the media in 2014-15: With 82% of Kenyans having phones, and 19% with smartphones, WhatsApp which is pre-installed on some phones, is becoming used more and more for sharing of pictures, video, audio, and chats – and they predicted it will become the default communication channels for businesses. Already Citizen has Road Hog and Chase Bank has launched a dedicated WhatsApp channel.
While it’s questionable if Kenyan corporations, having recently embraced Facebook and Twitter, will migrate to WhatsApp, the authors cited the fact that WhatsApp is pre-installed on some phones, and has a very low barriers to entry (compared to Twitter that requires  an e-mail address and some internet knowledge). 

2. Social TV changes everything. This is the age of the second screen where people watch TV, attend events with mobile phones in their hand and chat & comment  on social media. In Kenya, it’s also known as the “Tujuane” syndrome after a local dating TV show that has recorded as many as 9,200 tweets an episode – and it opens a new way for for more advertising and communication from companies to connect with customers.
3. Social media Devolves – it will devolved to counties  – and citizens will set out to claim their web presence and self organize like some groups in Wajir already have. Somewhat related, the 2014 Kenya blog awards highlighted some cool county-focused blogs from Uasin Gishu, Kisumu, Mombasa and Baringo. 

Other predictions
– The establishment of the smart audience – and the authors estimate Kenya has a smart audience of 0.5 million on twitter and 3.8  million on Facebook and TV and other media organization, now use Twitter, rather than SMS as their preferred interaction and feedback channel.
– The rise of social media as a profession

@Mkaigwa briefs the media on the Nendo Social Media report

– The decline of ‘likes’ as a measure on Facebook. The noted that people on some local corporate Facebook walls are asking what a company WhatsApp number is

– Corporate use of WhatsApp to replace intranets
– The role of online media in personal security like the government’s proposed Nyumba Kumi (10 homes) neighborhood watch system.
– Fun Fact While they also predicted that this year will see more transparency on the paid interaction between brands and influencers/bloggers to, everyone wanted to know which corporations are paying Kshs 10,000 to 30,000 ($350) per tweet to influencers. 

Idea Exchange: African Business, Bellagio, County tech, Kenya blog, TED Global

New, and ongoing, opportunities to apply for, including..

The African Media Initiative (AMI)  African Story Challenge  provides grants to support African business reporting and is inviting applications from individual journalists and newsrooms with unique story ideas or projects on business and technology that can only be produced with substantial support. The top twenty multimedia projects that show the best potential for adopting innovative storytelling techniques using data journalism tools, will be shortlisted for the final prize and will be awarded grants of up to $20,000 to produce them for broadcast and publication.

The All Africa Business Leaders Awards [AABLA] awards invite nominees in four categories, business leader of the year, business woman of the year, entrepreneur of the year and the young business leader of the year who through their vision, leadership and commitment make significant contributions, financial impact and/or a considerable differences through their assistance given to the work of voluntary organisations, communities, causes or society.  Deadline is 23 May.

Commonwealth Scholarships The Commonwealth Scholarship Commission has 
scholarships for candidates from developing African and South Asian Commonwealth countries to study for the part-time Masters degrees in International Human Rights Law from September 2014. Deadline is 23 April.

Nominations are now open for the 2014 Kenya Banking Awards by Think Business and categories include best bank in East Africa, and awards for product innovation, mortgage finance, SME, product, agency banking, internet, mobile, customer satisfaction, asset finance, best recovery, fastest growing, CEO, lifetime achievement, among others. 
Vote for the short-listed Kenya Blog Award finalists for the year 2014. This blog is nominated under the best business blog and there are other categories for best blogs in technology, photography, creative writing, food, environmental / agricultural, fashion/beauty, politics, corporate blog, topical blog, sports, entertainment/lifestyle, travel, health, county blog, best new blog and Kenyan Blog of the Year.

Kenya ICT Innovation Awards 2014 celebrate Kenyan companies and organizations that are using ICT in new and interesting ways. Categories this year include agriculture, BPO, education & training, environmental management, financial services, gender youth & vulnerable groups, healthcare delivery, housing & urbanization, manufacturing, social equity & poverty reduction, tourism, water & sanitation, wholesale & retail trade and finally county government issues. The deadline to apply is March 31.

Pivot East The 2014 edition of the most prestigious East African mobile start-up competition is back, and yhis years conference will be held on 24th – 25th June in Nairobi, Kenya. Apply in 5 categories of mobile finance, mobile enterprise, mobile entertainment, mobile society and mobile utility by 11 April. 

The Rockefeller Foundation Bellagio residency program offers academics from universities or think tank-based academics or scientists a serene setting conducive to focused, goal-oriented work, and the unparalleled opportunity to establish new connections with fellow residents from a stimulating array of disciplines and geographies. Fiction and non-fiction writers should apply through a separate Arts & Literary Arts Residency competition, and the Foundation does have a limited travel assistance program, based on income level of invited residents. Deadline is May 1.

The Royal Academy of Engineering Africa Prize for Engineering Innovation aims  to reward entrepreneurship and innovation in Africa in disciplines from mechanical, civil and computing to biomedical, oil and gas, mining and electronic engineering.  Every shortlisted entrant will receive six months of extensive mentoring, training and support in commercialising their innovation, as part of the Academy’s commitment to international development. Thereafter, finalists will be invited to present their innovation and a winner will be selected to receive £25,000. The deadline for entries is 30 May.
TED Fellowship. The TED Fellows program is looking for people who have “demonstrated remarkable accomplishment.” Normally, there are two admission cycles per year: one for TED and one for TEDGlobal with 20 Fellowships to each conference. Deadline  is April 18, 2014. 

EDIT

Golden Baobab Prizes for Literature are an annual Pan-African award series that recognize and celebrate excellence in stories targeting African children. Deadline is June 29.

The Business Daily Top40Under40 Women series is now open for 2014. Download entry forms from the Business Daily website and submit nominations via email. 

What other opportunities are out there? Share in the comments section

Mapping Financial Inclusion in Kenya

This week, FSD Kenya launched an interactive tool called the FinAccess Spatial Map that mapped all the formal financial service points in Kenya.  This has been an ongoing private-public partnership, and it’s notable as a previous FSD study on the numbers of ‘unbanked’ Kenyans became the justification for the relatively unregulated roll out of m-pesa and mobile money in the country.  

The searchable tool interprets data like financial service points (GIS locations of bank branches, mobile money agent), county borders, and local population numbers from the census – to plot some interesting metrics.

The tool tends to find that there are more financial service points in wealthier parts of the country (no surprise) and that more Kenyans live closer to a mobile money point (58% are within 3 kilometers of one) than a bank branch (21%). It can  also pick out useful trends for further research e.g. at the launch, it was mentioned that in Isiolo, 40% of the population own mobile phones, but only 20% use mobile money, while in Nyeri, 75% own phones, but an even larger number – 80% use mobile money.

Partners in the FSD mapping program included the Central Bank of Kenya, Brand Fusion, SpatialDev, and the Bill & Melinda Gates Foundation.

Kenya’s Money in the Past: M-Pesa Money Real Quick

This recently published book traces M-Pesa from its origins to the impact it has had on millions of Kenyan users. It has excerpts of interviews with insiders at Vodafone/Safaricom, Kenyan regulators, politicians, entrepreneurs, bankers, and dozens of other people, for who the service has had an impact on their lives.

While mobile money did not originate in Kenya, and the design of M-Pesa was not local, Kenya is the country that, for now, has extended mobile money far deeper than any country, and the book notes developments in other countries to emulate the success and scale of M-Pesa.

M-Pesa was the accidental outcome of a pilot project, but it is ultimately the end result of the hard work, partnerships (such as with Commercial Bank of Africa and DFID, but some broken at Faulu and Equity banks), funding, and decisions of some of the people interviewed. 

It’s development process was not widely understood, nor was it universally popular, especially with bankers, who (like almost everyone else) did not forsee the ernomity of what M-Pesa would become in the lives of hithero unbanked Kenyans. 

The book was completed in 2012, a few months before M-Pesa made a bigger foray into the world of banking when, Safaricom and Commercial Bank of Africa launched a SIM based bank account called M-Shwari.