Pension Fund Set to Back KETRACO’s Power Transmission Expansion
Kenya Electricity Transmission Company (KETRACO) is charting a new financing path by tapping into domestic financial institutions, specifically pension funds, insurance firms, and SACCOs to support its growing portfolio of power transmission projects.
This move signals a shift from the company’s traditional reliance on international loans and aims to accelerate the expansion of Kenya’s electricity grid.
Dr. (Eng.) John Mativo, KETRACO’s Managing Director, announced the plan during a stakeholder briefing, emphasizing the value of mobilizing local capital. “The quickest financier to come on board is financing from the people of Kenya insurance companies, pension schemes, and SACCOs through joint ventures,” he said.
The initiative is timely, as Kenya seeks to modernize and expand its energy infrastructure amid limited fiscal space for foreign borrowing. For years, KETRACO projects have been primarily financed by development partners such as the World Bank, African Development Bank, and JICA. However, economic pressures and rising debt have forced the government to seek sustainable funding models.
The Treasury has already set up a task force to identify viable strategies for raising long-term capital locally. One promising avenue is through pension schemes like the Kenya Power Pension Fund (KPPF), which manages substantial assets and is well-positioned to invest in infrastructure for stable, long-term returns.
This strategy aligns with national development goals, including strengthening the energy transmission network and ensuring reliable power delivery by 2027. By involving local financial institutions, KETRACO aims to enhance project delivery while supporting Kenya’s economic growth and energy reliability.
The proposed financing approach reflects a growing confidence in homegrown solutions to development financing leveraging Kenyan savings to power Kenyan progress.
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