Ruto suffers setback as court blocks Adani-Ketraco deal

Engineers from KETRACO repair one of the six electricity towers along the Olkaria-Lessos-Kisumu power line that was vandalized by unknown people in Kayole estate in Naivasha. [File, Standard]

President William Ruto’s government suffered a major blow after the High Court suspended the controversial multi-billion-shilling electricity transmission deal.

Yesterday, Justice Bahati Mwamuye of the High Court issued the orders barring the government and Adani Energy Solutions Ltd from implementing the Sh95.68 billion energy deal pending the determination of a lawsuit filed by the Law Society of Kenya (LSK)

“A conservatory order is hereby issued suspending the implementation of any project agreement between Ketraco, the Cabinet Secretaries for Energy, Treasury, the Directorate of Public-Private Partnerships, the Public-Private Partnerships Committee, the Attorney General, and Adani Energy Solutions Group or any of its related companies and entities regarding the development of transmission lines, substations, or any other electrical power infrastructure,” Justice Mwamuye ordered. 

The deal between Kenya Electricity Transmission Company (Ketraco) and the Indian firm involved the construction of 422 kilometres (km) of three high-voltage power transmission lines and two substations, strategically located to enhance connectivity and stability in the national grid over three decades.  

The 400kV Gilgil-Thika-Malaa-Konza line is to stretch 208.73 km and feature new substations in Gilgil, Thika, and Malaa. Meanwhile, the 220kV Rongai-Keringet-Chemosit line, covering 99.98 km, will establish additional substations at key locations, including Rongai and Keringet.  

The deal was initially announced in September 2024.

In his ruling, Justice Mwamuye also barred the government from entering into any new agreements or furthering any existing agreements concerning Adani and/or any of its related companies and entities with regard to the development of transmission lines, substations, or any other electrical power infrastructure.

Justice Mwamuye directed Ketraco, the Cabinet Secretaries for Energy and Treasury, the Directorate of Public-Private Partnerships, the Public-Private Partnerships Committee, the Attorney General, and Adani Energy Solutions Group, who are listed as respondents, to file their pleadings to the lawsuit within five days.

The matter shall be mentioned on November 11. The court ordered LSK to serve its pleadings to the government and Adani by close of business on Friday.

The court’s orders followed a petition filed by the LSK against Ketraco at the Milimani Law Courts, contesting the partnership between the Indian conglomerate and the State electricity transmission company.  

LSK through its chief executive, Florence Muturi, reveals how the multi-billion project was conducted in secret between Ketraco and Adani, without proper public participation.

“The petitioner contests the concession of critical transmission lines a strategic, vital, and profitable national asset to Adani and its subsidiaries for 30 years,” the court papers state.

In her affidavit, Muturi argues that under the agreement, Adani had proposed in May 2024 to build 422 km of vital transmission lines and two substations.

By October 10, 2024, the government had approved the relevant energy policies, effectively setting the stage for Adani’s planned construction of the major transmission lines and substations.

President William Ruto in a burst of hearty laughter after he switched on power at Victor Obae Opara’s shop during the commissioning of the Nyang’eni Village Electrification Project, Kisii County. [PCS]

Immediately thereafter, Muturi says on October 11, 2024, the Cabinet Secretary for Energy, Opiyo Wandayi, announced the signing of the project agreement saying all procedures were followed before the deal was entered into. The agreement was celebrated by the government as a strategic move to boost the country’s infrastructure and economic prospects, particularly in light of the country’s ambitious plans to tackle the power shortages that have hindered economic growth.

However, the deal sparked public outrage over the lack of transparency, the long-term implications of the lease, and its potential consequences.

Opposition to the agreement grew as concerns mounted about accountability and the impact on local companies.

LSK argues that the cost of the transmission lines and substations to be built under the agreement signed by Ketraco and Adani is 20 per cent higher than what is outlined in Ketraco’s transmission masterplan, raising concerns about whether the proposal offers value for money.

Muturi states that on September 11, IC Advocates LLP sent letters to Ketraco’s managing director seeking details on the opaque contract. 

Subsequently, on September 27, the Ketraco managing director declined to provide the requested information, citing that the project was still undergoing due diligence. LSK argues the lease agreement was marred by procedural irregularities and lacked adequate public consultation. 

“The agreement between Ketraco and Adani risks burdening both current and future generations in Kenya, thus violating the principles of intragenerational equity,” Muturi states

The petitioner contends that the project was developed in an opaque manner and that the government have deliberately concealed crucial information about the project.

“The process and manner in which the agreement was reached is a constitutional sham, tainted by secrecy, and critically lacking the principles of integrity, transparency, openness, and accountability,” LSK states

Additionally, LSK contends that the Ministry of Energy did not conduct proper due diligence and evaluation of the proposal, contrary to the provisions of the Public-Private Partnership Act and the Constitution of Kenya.

Muturi also raised concerns about the potential loss of national sovereignty over a critical infrastructure asset and the long-term financial implications for the country.

 “If conservatory orders are not granted, the country will lose control and management of the critical transmission lines and substations to a foreign entity,” she argues.  

 The ruling was issued just one day after President William Ruto expressed his support for the partnership between Adani Energy Solutions Ltd and Ketraco.

During the groundbreaking ceremony for the 35MW Orpower 22 Power Plant in Nakuru County on Thursday, October 24, the President praised public-private partnerships, emphasising their potential to alleviate the financial burden on taxpayers.

“The Adani Group is investing Sh95 billion in the transmission line with their own funds. Otherwise, we would have had to borrow that money, which would have placed a heavy burden on the people of Kenya.

‘‘This is a private-sector investment,” Ruto stated.