Africa-focused independent power producer Tembo Power, of Mauritius, has announced the appointment of two senior debt financiers – the Emerging Africa Infrastructure Fund (EAIF) and Finnfund – for its 15 MW Kaptis hydropower project in Kenya.

The $44-million run-of-river project is located near the town of Kakamega, in western Kenya, and is scheduled to enter into commercial operation in the third quarter of 2022.

South African asset manager Ninety One, which is an authorised agent for the Private Infrastructure Development Group’s EAIF, will act as mandated lead arranger for the financing of the project.

Debt financing of $30-million is required to advance Kaptis through the final design, planning and construction phases, with the project’s equity partners – Tembo Power, Metier and WK Power – to inject about $14-million into the construction of the plant.

Tembo Power founder Raphael Khalifa described the two lenders as major players in the African infrastructure sector and said their appointments represented a significant step towards the financial closing of the Kaptis project, scheduled for later this year.

Tembo Power is also in talks with the Kenya Power & Lighting Company to conclude a 20-year power purchase agreement based on a tariff of $0.082c/kWh. Other conditions precedent include a letter of support from Kenya’s Treasury and the securing of a generation licence.

Once fully operational, the hydropower plant is expected to produce at a yearly rate of 86 GWh, depending on rainfall and river flow rates.

Separately, Tembo Power is raising equity financing for a portfolio of ten projects, with a combined capacity of 186 MW, across Kenya, Burundi and the Democratic Republic of Congo.

Tembo Power is focusing on run-of-river opportunities, which are considered more environment-friendly than other hydropower technologies, as well as on medium- to high-head sites so as to limit dependence on river flow.