New leaders’ pledge on electricity spurs deals

The promise by the new government to have electricity for all Kenyans by 2020 has sparked a rush for energy deals among the private players.

Investors in the energy sector have heightened their activities seeking to make the most of investment opportunities.

The government has promised to use public-private partnerships to increase local electricity production with a view to turning the country into a net exporter of energy.

The new government has also promised to encourage new private energy generators in the Kenyan market and increase private investment in existing state-owned companies such as KenGen, Kenya Power and the Kenya Pipeline Company.

“The distribution and transmission of power can only be achieved when the government creates an environment for business people to provide affordable supply,” said Mr Raj Devani, the director of Adra International and Jade Petroleum.

Mr Devani lauded the government for its decision to give low-cost loans for households to buy small renewable power systems.

Solar panels

Revamping the current rural electrification programme to bring electricity to every village through small renewable energy projects such as solar panels and wind turbines will be a major boost to the industry and economy.

Last week Kenya Power signed a 25-year power purchase agreement with Africa Geothermal International Kenya (AGIL) for the development of the 140 megawatt (MW) geothermal project in Longonot.

The deal stipulates that AGIL will develop, construct, own and operate the plant while Kenya Power will purchase the power generated.

The plant operation date is scheduled for 2018. The Longonot Geothermal Project is adjacent to the Olkaria geothermal complex.

Currently, Kenya Power purchases electricity from the KenGen and six other Independent Power Producers.

(IPPs) — Iberafrica Power, Tsavo Power Company Limited, Rabai Power, OrPower4,  Mumias Sugar and Imenti Tea Factory Small hydros.