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Why Google is opting out of Kenyan wind plant investment
Google has cancelled plans to buy a 12.5 per cent stake in Africa's largest wind farm after delays to the project. The 310 megawatt (MW) Lake Turkana wind farm in Kenya was initially set for completion 2017, after which Google had committed to buy the stake from Danish wind turbine maker Vestas. Also the country set up two new facilities to test for the coronavirus. Initially, all samples taken from individuals suspected to have the virus were sent to South Africa. Rodney Omukhulu, Assistant Investments Analyst at Cytonn joins CNBC Africa for more.
Thu, 13 Feb 2020 14:57:01 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Google cancels investment in Africa's largest wind farm due to project delays, impacting Kenya's renewable energy targets.
- Kenya faces challenges in achieving green energy goals amidst delays in wind farm project and disruptions caused by the coronavirus outbreak.
- Central bank of Kenya introduces mobile bond platform to drive local market financing and deepen the country's capital markets.
Google has cancelled plans to buy a 12.5 per cent stake in Africa's largest wind farm, the Lake Turkana wind farm in Kenya, after delays in the completion of the project. The 310 megawatt wind farm was initially started in 2013 by Danish company, Vestas, with the aim to contribute 15% of the country's electricity to the national grid. However, the project has faced significant delays, particularly in the installation of transmission lines to connect the wind farm to the grid. Rodney Omukhulu, Assistant Investments Analyst at Cytonn, highlighted that the project was set for completion in 2017 but is yet to be finalized. The main reason for the delays has been attributed to compensation negotiations with landowners, as the project requires land that is currently occupied by settlers to be acquired. This negotiation process has caused a setback in the overall project timeline. Despite the setbacks, the wind farm is still operational, and discussions are ongoing to find a new buyer to facilitate the project's completion. The project was a key part of Kenya's goal to achieve 100% green energy by this year, showcasing the country's commitment to renewable energy sources. However, with the delays in the wind farm project, the country may face challenges in meeting its green energy targets. Kenya has been making strides towards adopting renewable energy sources to lower electricity costs and reduce dependence on non-renewable resources. The government has engaged in negotiations with Ethiopia for hydropower generation to supplement the country's energy needs. The cancellation of Google's investment in the wind farm signifies a setback in Kenya's renewable energy ambitions, and it underscores the importance of efficient project management and stakeholder engagement in large-scale infrastructure developments. In addition to the energy sector, Kenya is also facing challenges in the midst of the coronavirus outbreak. The country has set up two new facilities to test for the virus, as concerns grow over the impact of the outbreak on global supply chains. Companies, including those with significant ties to China like Kenya Airways, have suspended or cancelled flights, leading to disruptions in supply chains and potential economic consequences. The uncertainty surrounding the coronavirus outbreak has also impacted business relations between Kenya and China, with the potential for delays in investments and trade agreements. The lack of clarity on when flights to China will resume has created uncertainty in the business community and may affect future economic engagements between the two countries. Amidst these challenges, Kenya's central bank has introduced new mobile bond platforms to provide an additional avenue for local market financing. The mobile app allows investors to participate in government bond transactions below $140,000, streamlining the investment process and deepening the country's capital markets. This move is aimed at increasing participation in government securities and making it easier for individuals to invest in the domestic market. By leveraging technology, the central bank is making it more convenient for investors to access and monitor investment opportunities, ultimately contributing to the development of Kenya's financial sector. The introduction of the mobile bond platform aligns with the government's efforts to diversify funding sources and promote broader participation in the country's economic growth.
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