NAIROBI, Kenya — Kenya faces a potential multi-billion-shilling payout to India’s Adani Group after President William Ruto ordered the abrupt cancellation of a Sh96 billion electricity transmission project, now mired in controversy and international scrutiny.
The National Treasury’s Public-Private Partnership Directorate confirmed that negotiations are underway to determine compensation following the informal termination of the 30-year contract in late 2024.
Legal experts estimate taxpayers could shoulder at least Sh5 billion in damages.
The deal — signed in October 2024 — would have seen Adani Energy Solutions construct a 206-kilometre Gilgil–Konza transmission line and power substations to boost electricity access around Nairobi.
Sources say Ruto’s decision came after Adani Group founder Gautam Adani and his nephew Sagar Adani were indicted in the U.S. on fraud and bribery charges, prompting Kenya to cut ties.
Treasury officials are now pursuing a mutual separation agreement to avoid heavier financial penalties, though critics argue the move exposes Kenya’s vulnerability to multinational interests.
The Adani deal was expected to generate Sh21 billion annually over three decades before handover to Kenya, meaning the cancellation could alter the country’s long-term energy investment outlook.
Analysts warn that the payout, if confirmed, will deepen fiscal pressure on a government already battling public debt and inflation.
