Lake Turkana Wind Power and the Marsabit-Suswa transmission line delay
A 310 MW wind farm in northern Kenya was ready on 27 January 2017, but the state-built transmission line was completed only in September 2019. Kenya's Auditor-General recorded Ksh 18.5 billion in payments claimed for electricity that could not be delivered, and a Kenyan court has found that the titles to about 150,000 acres of community land were irregularly acquired.
Auditor-General special audit; about EUR 167.3 million as stated in the record. Ksh 10.3bn was paid by the state; Ksh 9.8bn was to be collected through the tariff.
Status As of the latest dated entries (2024): the appeal against the cancellation of the community land titles was continuing; whether the tariff surcharge ended in May 2024 is not on record.
- Plant owners — The take-or-pay contract secured their revenue while the line was delayed.
- Vestas, Finnfund and IFU — Sold their stakes in February 2024 to a BlackRock-managed fund; Vestas's stake was 12.5%. Wind Insider
- The Kenyan state — Paid Ksh 10.3 billion of the deemed-energy claims.
- Kenya Power customers — Were to pay Ksh 9.8 billion through a tariff surcharge of EUR 0.00845 per kWh from 1 June 2018 to 31 May 2024.
- Marsabit community landholders — The court found that titles to about 150,000 acres of community land were irregularly acquired. Business & Human Rights Resource Centre
What happened
The Lake Turkana wind plant, with 310 MW of capacity and 365 turbines, was ready on 27 January 2017. The Kenyan state was to build the 428 km Marsabit-Suswa transmission line to carry its electricity. The line was 381 days late and was completed in September 2019. A 2009 power purchase agreement obliged Kenya Power to buy all of the plant's net output for 20 years. Under a take-or-pay clause the buyer pays for the contracted quantity whether or not it uses it; in electricity the payment is called a capacity payment or a deemed-energy payment, meaning payment for energy that could have been delivered.
A special audit by Kenya's Auditor-General, Nancy Gathungu, found deemed-energy claims of Ksh 18.5 billion (about EUR 167.3 million) for 27 January 2017 to 10 September 2019. The state paid Ksh 10.3 billion of this. The remaining Ksh 9.8 billion was to be collected from electricity users through a surcharge of EUR 0.00845 per kilowatt-hour on the tariff between 1 June 2018 and 31 May 2024. After a recalculation the company refunded Ksh 785 million. The parent company of the Spanish firm that built the line had gone bankrupt.
The plant's land was also taken to court. Representatives of Laisamis and Karare in Marsabit filed a case in 2014. On 19 October 2021 the Meru Environment and Land Court ruled that the titles to about 150,000 acres of community land had been irregularly acquired. On 22 May 2023 it rejected the company's application for a review and the titles were cancelled. On 28 July 2023 the Court of Appeal declined to stay the cancellation. The appeal was continuing.
Sarima, a village resettled to make room for the plant, had about 2,000 residents, according to a 2016 Danwatch investigation. As of March 2016, 92 people from the village worked on the project, mostly in security and construction. An application to lease 100,000 acres had been made in 2006 and approved in 2007. A university student living in Sarima told Danwatch that the project had promised jobs and that more than 200 young people in the village struggled to find food. A woman who did not give her name said she had applied for jobs three times and that prostitution had begun in the village.
Vestas, the Finnish development fund Finnfund and the Danish development fund IFU were among the plant's owners. In February 2024 all three sold their stakes to the Climate Finance Partnership fund, which BlackRock manages; Vestas's stake was 12.5%.
- 2006Application to lease 100,000 acres at Sarima (approved 2007)
- 2009Power purchase agreement obliging Kenya Power to buy the plant's net output for 20 years
- 2014Representatives of Laisamis and Karare in Marsabit file a land case
- 2016Danwatch investigation of Sarima: about 2,000 residents, 92 working on the project
- 2017Plant ready on 27 January; the transmission line is not
- 2018Tariff surcharge period begins on 1 June
- 2019Transmission line completed in September; audited claim period ends 10 September
- 2021Meru Environment and Land Court finds the land titles irregularly acquired (19 October)
- 2022Company refunds Ksh 785 million after recalculation
- 2023Review application rejected and titles cancelled (22 May); Court of Appeal declines to stay cancellation (28 July)
- 2024Vestas, Finnfund and IFU sell stakes to a BlackRock-managed fund (February); tariff surcharge period to end 31 May
What was said
Where accounts differ
Each party's account, side by side, with its source. The record does not settle these points; it shows them.
Figures of Ksh 5.7 billion, USD 52.5 million and Ksh 18 billion circulated.
Deemed-energy claims of Ksh 18.5 billion for 27 January 2017 to 10 September 2019; Ksh 10.3 billion paid by the state and Ksh 9.8 billion to be collected through the tariff.
Refunded Ksh 785 million after the recalculation.
Filed the case in 2014 over community land of about 150,000 acres.
Business & Human Rights Resource CentreRuled on 19 October 2021 that the titles were irregularly acquired, and cancelled them after rejecting a review on 22 May 2023.
Business & Human Rights Resource CentreApplied for a review, which was rejected; the appeal is continuing.
Business & Human Rights Resource CentreHow it looked
Shown
Recorded
- The plant was ready on 27 January 2017; the 428 km Marsabit-Suswa line, to be built by the Kenyan state, was completed in September 2019, 381 days late.
- Deemed-energy claims for 27 January 2017 to 10 September 2019 totalled Ksh 18.5 billion (about EUR 167.3 million) per the Auditor-General's special audit; Ksh 10.3 billion was paid by the state and Ksh 9.8 billion was to be collected through a tariff surcharge of EUR 0.00845 per kWh between 1 June 2018 and 31 May 2024.
- After a recalculation the company refunded Ksh 785 million.
- On 19 October 2021 the Meru Environment and Land Court ruled that the titles to about 150,000 acres of community land were irregularly acquired; on 22 May 2023 it rejected the company's review application and the titles were cancelled; on 28 July 2023 the Court of Appeal declined to stay the cancellation; the appeal continues.
- Danwatch (2016): Sarima had about 2,000 residents; 92 villagers worked on the project, mostly in security and construction; a lease application for 100,000 acres was made in 2006 and approved in 2007.
- Vestas (12.5%), Finnfund and IFU sold their stakes in February 2024 to a fund managed by BlackRock.
Who gained
Reached nature or the ground
Gained elsewhere
Responses on record
- Lake Turkana Wind Power (2022): Refunded Ksh 785 million after the deemed-energy claims were recalculated.
- Lake Turkana Wind Power (2023): Applied for a review of the 19 October 2021 ruling; the application was rejected on 22 May 2023. · Business & Human Rights Resource Centre
In court and with insurers
Lawsuits and rulings
- 2014–2021-10-19OngoingCommunity land titles for the Lake Turkana wind plantEnvironment and Land Court at Meru; Court of Appeal · Civil · Representatives of Laisamis and Karare, Marsabit County → Lake Turkana Wind Power (the party whose review application was rejected); other defendants not stated
The court ruled on 19 October 2021 that titles to about 150,000 acres of community land were irregularly acquired. It rejected the company's review application on 22 May 2023 and the titles were cancelled. The Court of Appeal declined on 28 July 2023 to stay the cancellation; the appeal was continuing. Business & Human Rights Resource Centre
Insurers
What nature saw
Nature's report opens this page. Below: further outcomes measured on the ground.
What we don't know
Nature
- Not measured Harm to nature: The record holds no measurement of harm to nature.
Accounts
Record
- None on record The sources reviewed do not give the amount of the African Development Bank guarantee.
- None on record The sources reviewed do not say whether the tariff surcharge ended in May 2024 as scheduled.
- None on record No record was found of the situation after 2016 of the Sarima university student who spoke to Danwatch.
- Insufficient Reported but not independently verified: that the government paid investors a delay penalty of Ksh 10.2 billion and that the World Bank withdrew its guarantee because of the take-or-pay clauses.
- None on record The audit components as reported (Ksh 10.3 billion paid by the state and Ksh 9.8 billion to be collected through the tariff) are not stated to reconcile with the Ksh 18.5 billion total; a recalculation and a Ksh 785 million refund followed.
- None on record The sources give a delay of 381 days and an audited claim period of 27 January 2017 to 10 September 2019, and do not reconcile the two.
- None on record Press figures of Ksh 5.7 billion, USD 52.5 million and Ksh 18 billion have circulated; the audit figure is a claim of Ksh 18.5 billion.
Did the harm stop?
The record concerns payments and land titles and does not describe environmental harm. The line was completed in September 2019, and the appeal over the cancelled titles was continuing.
Who paid?
The Kenyan state paid Ksh 10.3 billion, and Ksh 9.8 billion was to be collected from electricity users through a tariff surcharge between 1 June 2018 and 31 May 2024.
Sources
Press and investigations
- Vestas sells stake in Kenyan Lake Turkana Wind Power Limited to CFPWind Insider · 2024-02-23
Communities and civil society
- Lake Turkana Wind Power lawsuit re land rights, KenyaBusiness & Human Rights Resource Centre ·
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