Quest for power loses steam

President Uhuru Kenyatta’s pledge to Kenyans for a 50 per cent reduction in the cost of electricity by next year may not materialise after the Geothermal Development Company said it will not be able to add 105 megawatts to the national grid by the end of the year.  

A work plan by the company outlines the steps the government must take, beginning with commissioning and drilling, to inject 105 MW into the national grid by the end of December.

According to company, the setback is due to tendering delays, but insiders attribute it to the absence of steam.

The firm’s main project this year — the Menengai steam power generation — was to begin next month after three independent power producers were named.

But nothing has happened, and the company has said everything has been put on hold until November 2015.

The state agency blames the delay on prolonged negotiations between Kenya Power and independent power producers.

“The delay has been occasioned by the lengthy period it has taken before signing of power purchase agreements,” Geothermal Development Company chairman Faisal Abbas said Monday.

INSUFFICIENT STEAM
But sources privy to the goings-on say the company contracted to gather steam has failed begin because the identified wells are not producing enough.

Sources said they did not understand why the company was outsourcing drilling services when they had invested billions to buy drilling rigs from China.

So far, Sh60 billion has been spent on drilling, which has not been fruitful.

And news of the absence of steam has not gone down well at State House. Geothermal Development Company will be hard-pressed to explain how they used the money but did not produce any steam.

“As of now, there is no steam. We are sitting idle as they try to seek alternatives,” a highly placed official who sought anonymity said.

The geothermal company had in May picked three firms: Quantum Power, OrPower 4 and Sosian Energy to generate 107 MW where Geothermal Development Company would supply steam while investors built power plants.

LOW COST OF GOODS
Last month, President Kenyatta commissioned the Olkaria IV power plant, which added 140Mw to the national grid.

“Take my word that the cost of goods will come down, and this will lead to a lower cost of living for all Kenyans,” President Uhuru pledged.

And on Thursday last week, Kenya Power announced it had signed a power purchase agreement with the three firms.

“In negotiations, you can’t blame any party. The financiers needed to do their background checks on these firms so they can get guarantees,” Kenya Power managing director Ben Chumo said.

“We signed on Thursday, and the agreement has now been forwarded to the regulator. The commercial operation date is now November 30, 2015.”