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A Chinese company has entered into a Sh9 billion partnership with a Kenyan firm to build the first solar panel factory in East Africa.
The move is expected to reposition solar as a key source of energy in Kenya by making it more affordable to millions of consumers who depend on the national electricity grid for their energy needs.
It is estimated that the Beijing Tianpu Xianxing Enterprises and Electrogen Technologies venture could see the prices of solar panels drop by up to 65 per cent.
Manufacture of solar panels is expected to open a lucrative market for scrap metal merchants who have been fighting bruising battles with Chinese experts in the past three years by boosting demand for hydraulic batteries.
Construction of the facility is set to start in October for completion in March 2008.
"There is a huge market for solar panels in this market. Currently the near monopoly in the market means consumers pay more than they should. We see prices dropping to a third of what they are currently," said Mr Michael Munyao, the executive director of Electrogen Technologies.
The project will be implemented through Pan African Technologies, a jointly owned company in which Beijing Tianpu has a 70 per cent interest and will raise $100 million (Sh7 billion) from internal resources.
Its local partner is expected take up the remaining fraction of the financing plan in cash and kind, including $40 million (Sh2.8 billion) in cash and three acres of land along Nairobi's Mombasa Road where the factory is to be erected by a local company of Chinese origin.
Once built, the factory will source the materials required locally and employ a minimum of 100 Chinese trained staff.
"Because they will be locally manufactured, Pan-African's products will cost less than the currently available imported options, with a typical system retailing for Sh5,000 rather than Sh20,000," said Mr Munyao.
Additional information: Please refer to AllAfrica for the full story.
News date: 17/08/2007