Gogo Hydro Plant Now Set For Massive Sh8bn Upgrade

For decades, families and businesses in Western Kenya have endured unreliable power from the ageing Gogo Hydro Power Plant in Migori County. 

But now, a long-overdue upgrade is on the way, raising hopes of steady electricity and an end to years of frustration for families and businesses in Western Kenya.

Built 64 years ago, the plant has been struggling along with just 2 megawatts (MW) of output — barely enough for local needs. Once modernised, however, it will churn out 8.6MW, a fourfold leap that could light up homes and businesses weary of persistent shortages.

KenGen will modernise the plant at a total cost of Sh8.3 billion. Support for the project is being provided through a Sh7.49 billion concessional loan from the German Development Bank, KfW, alongside a Sh663 million grant from the European Union. KenGen is contributing Sh150 million.

Treasury Cabinet Secretary John Mbadi, who signed the agreement alongside KfW’s Kristina Laarman, said the loan terms were favourable. 

“Because we have to cost our loans and ensure that they fall within our fiscal space, we set three per cent as the bare minimum we can accept,” he said, noting that the loan carries a 2.98 per cent interest, a five-year grace period, and a 15-year repayment.

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Mr Mbadi stressed that unreliable electricity had discouraged investment in Western Kenya. “No one would want to invest in an area where there is no reliable source of energy. 

With this redevelopment, chances are very high that we are going to see more industries moving to Western Kenya,” he said. 

He added that improvements to roads and airstrips were also underway to attract investors in agriculture, tourism and manufacturing.

The region’s industrialisation has long been hampered by frequent power cuts. A separate, privately driven plan by Indian billionaire Gautam Adani to revamp a key Homa Bay substation collapsed, leaving energy bottlenecks unresolved.

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Germany and the EU hailed the project as a milestone in Kenya’s clean energy shift, with Ambassador Sebastian Groth citing his country’s growing commitment.

“Hydropower is the most sustainable and stable form of electricity production. We are very happy that we can more than quadruple the Gogo plant’s output by 2030,” he said, noting KfW’s energy portfolio in Kenya already stood at about Sh85.6 billion.

EU Ambassador Henriette Geiger added: “The EU has for many years backed the East African power pool, which connects grids across countries. Connecting fragile systems makes them stronger as a network.”

The Gogo upgrade is expected not only to stabilise electricity supply but also to create jobs and open up opportunities in cross-border trade, tourism, and agribusiness.

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