The Kenya Tea Development Agency (KTDA) has come out strongly to dismiss allegations that over Ksh 1 billion contributed by farmers from the West of the Rift Valley were diverted to other regions.
In a press release issued on Tuesday, KTDA affirmed that the funds were fully accounted for and used exclusively on power projects within Kericho and Bomet counties.
The agency was responding to claims made by some political leaders suggesting that tea farmers contributions had been redirected to the East of the Rift Valley.
The KTDA labelled the accusations as false and misleading, emphasizing that they disregard the transparent financial systems put in place for the implementation of the Settet Power Generation Company’s projects.
According to KTDA, Settet Power Generation Company Limited was incorporated in October 2010 with the goal of developing small hydro power plants to provide reliable and affordable electricity to tea factories in the region. The company is jointly owned by seven tea factory companies in Kericho and Bomet—namely Kapkatet, Litein, Tegat, Momul, Kapkoros, Mogogosiek, and Kapset—as well as KTDA Power Company Limited. Each shareholder holds a 12.5 percent stake in the company.
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“The Settet Power projects are farmer-owned investments aimed at achieving long-term energy self-sufficiency and operational efficiency for tea factories in the West of the Rift Valley,” the agency stated.
The agency further stated that, currently, two hydro projects are under construction: the Chemosit Small Hydro Plant, with a capacity of 2.5 megawatts, and the Kipsonoi Small Hydro Plant, with a capacity of 2.6 megawatts.
The projects are being financed through a 65:35 debt-to-equity ratio, requiring a total equity contribution of Ksh 1.1 billion from the shareholders. As of October 2025, KTDA confirmed that shareholders have contributed Ksh 1.03 billion, all of which has been used within the approved budgets of the two projects.
The agency provided a breakdown of the expenditure, stating that Ksh 580.8 million has gone to civil works contractors, Ksh 204.8 million to project consultants, Ksh 350.8 million to electromechanical equipment, and Ksh 71.4 million for land acquisition at the Chemosit and Kipsonoi sites.
In total, Ksh1.208 billion has been spent on the projects, including Ksh174 million covered through internal borrowing to address a temporary funding gap.
KTDA emphasized that none of the funds have been misappropriated or diverted elsewhere.
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The agency acknowledged that some challenges have delayed project completion, citing issues such as delayed debt closure from international financiers, land acquisition processes, and conflicts over transmission wayleaves.
However, it also reported significant progress, particularly after the successful conclusion of a USD 8.6 million debt financing deal in September 2024 with the IFC/Proparco/FMO syndicate for the Chemosit project.
KTDA noted that civil works at Chemosit are now 49 percent complete, with electromechanical installations reaching 78 percent, adding that the project contractor has resumed work, and completion is expected by May 2026.
“Meanwhile, work on the Kipsonoi project continues, with land compensation and topographical surveys underway as financing discussions progress with potential lenders.” KTDA said
Reassuring farmers and stakeholders, KTDA stressed that all expenditures are subject to external audits and regularly reported during annual general meetings and to factory boards.
The agency underscored its commitment to transparency, accountability, and prudent financial management.
KTDA further urged leaders to verify facts before making public statements that could mislead farmers or undermine vital community-driven development efforts.
By Philip Koech
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