Google drops plan to buy Lake Turkana power stake

American technology giant Google has cancelled plans to buy a 12.5 percent stake in Kenya’s Lake Turkana Wind Power (LTWP), Africa’s largest wind farm that was officially commissioned last July.

Denmark based firm, Vestas, disclosed Monday that Google had ended the quest to buy its stake in LTWP after delays in the project.

The 310 megawatt (MW) Lake Turkana wind farm was initially set for completion in 2017, after which Google had committed to buy the stake from Vestas. However, the delays led to Google cancelling the agreement last year, Vestas said in a statement published by Danish media.

“Due to delays relating primarily to the transmission line, the Vestas agreement with Google was cancelled in 2019,” said Vestas. “As Vestas’ strategy doesn’t include being a long-term wind park owner, we’re currently in commercial dialogues with potential buyers of our shares.”

Google was not immediately available for comment.

The wind farm was ready for launch in 2017, but remained idle due to delays in installing transmission lines needed to get the clean power to the national grid and customers. The 428 km powerline from Loiyangalani in northern Kenya to Suswa in Narok County was set to be completed by October 2016, but demands for compensation from landowners along the route and other issues delayed it. The line was further delayed after a Spanish firm contracted to build the line went under. Kenya then tapped a Chinese company to complete it. The Lake Turkana wind farm is expected to provide 15 percent of Kenya’s total electricity needs.

Besides its online advertising business, Google also runs other ventures, including investments in renewable energy projects. It has invested billions of dollars in solar and wind power plants with a total capacity of 5,475 megawatts to generate returns besides contributing to efforts in fighting climate change.

“In 2017, we became the first company of our size to match our entire annual electricity consumption with renewable energy (and then we did it again in 2018),” Google chief executive Sundar Pichai said in a blog published last September. “As a result, we became the largest corporate buyer of renewable energy in the world.”

Google now has an interest in 52 renewable energy projects around the world, committing more than $7 billion (Sh712 billion) to construction that will create thousands of new jobs.

Norfund’s stake in the Turkana power project was acquired in 2013 at a cost equivalent to Sh1.2 billion. The project cost a total of €623 million (Sh70.3 billion), with debt investors providing 70 percent of the amount or €436 million (Sh49.2 billion).

Shareholders, including Norfund, the Danish Climate Fund, Sandpiper and Finnfund, provided the rest of the capital. The project has been credited with boosting Kenya’s electricity supply while reducing reliance on the more expensive diesel-powered plants that harm the environment through pollution.