Norwegian company injects Sh309m into Awasi solar plant

Norwegian solar lender Empower New Energy has invested Sh309 million ($2 million) to build a 2.5 megawatt-peak (MWp) solar plant at a steel factory in Awasi operated by Abyssinia Iron and Steel Limited.

Empower and Abyssinia signed a 25-year Power Purchase Agreement (PPA) on Wednesday that will see the steel firm purchase cheaper power from the solar plant which will be built by Spenomatic Group, an East Africa-focused renewable energy company.

“We are thrilled to partner with Abyssinia Steel and Spenomatic to bring cost-saving and clean energy solutions to Kenya,” said Terje Osmundsen, the Chief Executive Officer of Empower New Energy.

“Together, we will contribute to the growth of a low-carbon economy in Kenya, fostering a greener future for the manufacturing industry in Kenya.”

The 2.5MWp solar project is Empower’s first investment in Kenya. The company projects that the project will generate 4.8 gigawatt-hours (GWh) of renewable electricity per year.

“This new 2.5 MWp solar plant represents another significant step towards a green and more prosperous future for the company,” said Abyssinia Steel CEO Jateen Patel, even as the firm eyes power cost savings from the project.

The Abyssinia Group of Industries is one of Eastern Africa’s largest steel producers with an annual capacity of close to a million metric tons. The company has manufacturing and mining operations in Kenya, Uganda, Ethiopia, and Rwanda. Abyssinia is the latest to join a growing list of companies switching to their own power generation to reduce their energy costs.

Other large power users that have incorporated their own power generation include British American Tobacco (BAT), Unilever Tea Kenya, TotalEnergies Kenya, Simba Cement Limited, National Cement, Bidco, and Africa Logistics Properties (ALP).

This is a major blow to monopoly distributor Kenya Power, which has lost about 10.83 percent of capacity to private power generators.

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