The Kpone independent power plant, which is being developed by Cen-power Generation Company, is anticipated to play an important role in meeting Ghana’s growing electricity demand.
African Infrastructure Investment Managers (AIIM) PART OF OLD Mutual Alternative Investments is one of the project’s core equity investors.
AIIM is one of the main investors in the Kpone independent power plant in Ghana,expected to be commissioned by the end of 2017.
Kpone is one of the first independent power plants to be implemented in Ghana and it is certainly the largest to date, being a 340MW combined-cycle facility. It was specifically designed to take a number of fuel sources so that it doesn’t become a stranded asset should one of the envisaged fuel sources not be available. The plant can run on crude oil, it can run on distillate (which is also a derivative of petroleum), and it can also run on natural gas.
It is expected that over the course of the next two to three years, piped natural gas will be available to the facility. This will reduce the tariffs that power users are currently facing in Ghana, because power produced using natural gas is a lot cheaper than power that is generated through crude oil or other petroleum derivatives.
The predominant players in other independent power plants in Africa have tended to be parties from outside Africa. For instance, at the debt that has been sourced for this project, all the commercial lenders are African and largely South African-based entities.
“On the development finance institution side, which is approximately half of the debt funding, you have the likes of the Development Bank of Southern Africa and the Industrial Development Corporation involved as well”, Vuyo Ntoi, investment director at AIIM, has stated.
On the equity side, other than Sumitomo (a Japanese group), all the other shareholders are African, including ourselves.
“So it is a company that is pre-dominantly equity financed by African parties. And from a construction perspective, the contractor is Group Five, again a South African company”, he added.