•The National Assembly however blocked the lifting of the ban as it sought to conduct its own inquiry on the PPAs and find a way to lower power bills.
•Currently, Kenya Power has about 20 IPPs in its books cutting across the entire energy mix of wind, solar, hydro, geothermal and thermal.
Kenya needs more Independent Power Producers (IPPs) to meet electricity demand projected to increase in the medium to long-term, Kenya Power managing director Joseph Siror now says.
This is on the back of growing peak demand that has gone up to 2,177MW and an upward of 2,200MW in some instances.
The country has an installed capacity of 3,311MW of which 3, 155 is effective but generation from some sources such as wind and solar have traditionally fallen depending on weather conditions and night factor (for solar) affecting overall injection to the grid.
The bulk of power come from KenGen and is mainly geothermal.
There is also demand from neighbouring countries mainly Uganda, with Kenya z importing energy from Uganda Electricity Transmission Company (UETCL), Ethiopia Electric Utility (EEU) and Tanzania Electric Supply Company Limited (TANESCO).
The biggest headache for Kenya Power is however long-term investments as it projects the country’s peak demand to hit a high of 4,000MW in the long-term.
With this, the country needs to invest in more IPPs, Siror said, amid the lapse of existing contracts, where the government has frozen renewal of thermal plants.
Existing thermal contracts include Iberafrica whose contract expires in 2034, Rabai Power (2030), Tsavo (which started being phased out in 2021 with Kipevu 3 due for decommissioning in 2031), Thika Power (2033), Gulf Power (2034) and Triumph Power (2034), contracts the government is not keen to renew amid the push for renewable energy.
However, the country cannot entirely depend on renewable sources, experts say, hence a need for having an energy mix that includes thermal.
The increase in peak demand is also expected to be driven by continued connectivity as the utility firm enters the fourth phase of the Last Mile Connectivity programme that targets an additional 280,473 households across 32 counties.
Peak occurs between 8pm and 8.30pm in the Coastal region and 7.30pm and 8pm for the rest of the country.
The last IPP Kenya Power signed was in the year 2020.
“We are really in a state now where we need a lot of power generation. It is time we say we need more IPPs because when we look at the difference between our total or available generation, vis-à-vis our peak, we need to invest,” Siror said.
He spoke yesterday during the launch of a media campaign on prepaid meters update, As Kenya moves to comply with the expected November global shift.
“We need to also look at what happens in an interconnected systems. You must plan for the instances where the neighbouring countries may want to draw a lot of power from you. For instance on Tuesday, there was a need to support Uganda to the tune of 181MW. When we look at all those dynamics, we are at a point where we really say we need a lot of generations to come,” Siror said.
Cabinet in February last year lifted a moratorium on procurement of fresh IPPs that had been put in place by former President Uhuru Kenyatta’s administration, in 2021, to allow vetting of existing IPPs and the Power Purchase Agreements.
This was after an outcry over high electricity bills pegged on the IPPs whose most contracts are dollar denominated, with recouping of the heavy investments from commercial loans being blamed for the high rates they sale electricity to Kenya Power.
The National Assembly however blocked the lifting of the ban as it sought to conduct its own inquiry on the PPAs and find a way to lower power bills.
Currently, Kenya Power has about 20 IPPs in its books cutting across the entire energy mix of wind, solar, hydro, geothermal and thermal, with most contracts expiring around 2034.
It takes up to seven years to put up an energy plant for instance geothermal, from prospecting to production.
Renewable energy accounts for 84.7 per cent of the total energy mix while thermal and imports account for 10.5 per cent and 4.85 per cent, respectively.