What you need to know:
- We have included and increased geothermal in the energy supply equation and now more and more wind power is coming on stream. Construction on the Lake Turkana wind project and the supporting infrastructure is under way.
- Whichever way one looks at it, the broadened supply base makes us less vulnerable to the sort of high prices we witnessed when we became dependent on emergency power plants using imported fuel.
- The main argument against the single gauge railway is the huge cost, not that it is superfluous to our needs.
The production of energy and supply of electricity in Kenya have a chequered history. For a long time, the country relied on hydro-generated power. This was fine when the relevant dams had sufficient water.
Then there was the lack of investment in the sector in the 1990s, culminating in frequent outages and darkness. Part of this arose from the unwillingness of donors and international investors to release funds for energy-related projects due to governance issues. Expensive fuel-guzzling emergency plants were imported and used as a stop-gap measure in 2000, 2006, and in the drought years of 2008-2009.
The consumer paid commensurately and painfully higher prices as a result. This, in turn, had a negative effect on economic growth, with many blaming high electricity prices for general lack of competitiveness, especially in the manufacturing sector.
Slowly but surely, we have broadened our energy base and thus reduced reliance on hydro and emergency power plants. We have included and increased geothermal in the energy supply equation and now more and more wind power is coming on stream. Construction on the Lake Turkana wind project and the supporting infrastructure is under way. This mega project was subjected to an understandably slow start due to the huge infrastructural and financing challenges.
We can meet the increased electricity demand of around 6 per cent per annum and are on schedule to meet even higher demand in the future. Getting connected to the grid is now becoming much easier and electricity prices have come down.
Whichever way one looks at it, the broadened supply base makes us less vulnerable to the sort of high prices we witnessed when we became dependent on emergency power plants using imported fuel. It also provides a solid foundation for reasonably priced electricity in the future. One area that needs attention is checking and reducing system faults.
These have increased by around 30 per cent in the past three years. That is unimpressive, considering that regular power supply is vital to many of our economic drivers.
The overall position is generally a lot better than a decade or so ago. We have a broad mix of power generation, which meets current demand and will do so for several years to come. The expected coming on stream of the Lake Turkana wind project in two years will enrich and solidify that mix.
However, there is a dark cloud on the horizon in the form of the ongoing plan to add 960 MW to a grid that already has enough power supply for now and for the foreseeable future through the Lamu coal-fired power plant.
This project has several glaring disadvantages. First, we do not need it. Secondly, it is located in the wrong place, is coming at the wrong time, and is the wrong size. To make matters worse, it is supposed to be powered with coal imported from South Africa, not Kitui.
This project is shaping up to be a white elephant with little merit and designed to add to our international debt. The main argument against the single gauge railway is the huge cost, not that it is superfluous to our needs. The Lamu coal-fired plant does not even have that merit and should be cancelled immediately.
Mr Shaw is a Nairobi-based businessman. [email protected]