The Board of the African Development Bank (AfDB) approved the Lake Turkana Transmission Line Delay Partial Risk Guarantee for €20 million, the first of the African Development Fund’s Partial Risk Guarantees (ADF PRG). The ADF PRG is a risk mitigation instrument that covers private lenders and investors against the risk of a possible government failure to meet contractual obligations to a project.
This flagship ADF PRG, a risk mitigation instrument that covers private lenders and investors against the a possible government failure to meet contractual obligations, will support the Lake Turkana Wind Power Project in Kenya.
Under the wind project, the Lake Turkana Transmission Line Delay PRG will be used to alleviate the risk for the construction of a 428-km publicly owned transmission line between Loyangalani and Suswa and associated substations needed to connect the project to the national grid. The PRG will support the government’s on-time delivery of the transmission line and will reduce the risk of it being unable to meet payment obligations. More specifically, the ADF PRG will provide partial risk mitigation to Lake Turkana Wind Power Ltd. and the providers of debt financing to the project for risks associated with construction delays.
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