Kenya Power to Improve Shaky Power Grid

Kenya Power plans to spend 8.7 billion shillings ($96.6 million) on new power distribution stations to improve electricity supply aimed at curbing chronic power shortages that companies say have discouraged investments.

Kenya Power, the country's main electricity transmission company, said in a statement on Friday it plans to build 36 new substations, with 10 of them being put up in the coast region.

Kenya's government has said it aims to boost power production capacity in East Africa's biggest economy by an extra 5,000 megawatts (MW) to the existing 1,664 MW of generation capacity by 2017, to meet growing demand.

Kenya Power, which serves about 2.8 million customers out of a population of 40 million, relies heavily on renewable energy such as hydro power and geothermal gas for its electricity.

The company annual pre-tax profit grew by 55 percent driven by higher tariffs, increased sales of electricity and reduced losses due to improvements in the power grid.

(1 US dollar = 90.1000 Kenyan shilling) (Reporting by George Obulutsa; Editing by James Macharia)