Kenyan Governemnt launches initiatives to lower the cost of electricity

Posted: September 9, 2013 in Politics
President Uhuru Kenyatta

President Uhuru Kenyatta

Kenyan Government is set to implement an ambitious 5000+ Megawatt power project to provide reliable and adequate power and ensure affordable and competitive cost of electricity to spur economic growth.

The project, the largest single imitative to be undertaken in the country, will mark a shift from unreliable hydro and expensive thermal based power generation to reliable green and cheaper natural gas and large scale coal fired power plants, President Uhuru Kenyatta said.

In a speech presented at the project launch in Nairobi on Monday, President Kenyatta said electricity demand in the country is expected to rise sharply as devolved units take shape, more consumers get connected to the national grid and numerous economic activities spring up.

“The shift will reduce the cost of doing business and make Kenya one of the Low Cost Countries. It will also reduce electricity generation fuel costs from the current US$ cents 26 – 36 range to less than 6.51 per unit of electricity.” President Uhuru Kenyatta.

The President affirmed his Government’s commitment to putting in place policies aimed at steering the country on a strong economic growth path with a view to attaining the 10 per cent Vision 2030 growth rate.

He said introduction of large-scale natural gas and coal-fired plants in the 350 MW range will also bring in unprecedented economies of scale in power generation given that the sector has been operating many small diesel thermal plants of less than 30 MW capacity.

The president said the mining activities, including production of cast iron and different steel products from local iron ore deposits, irrigation of large tracts of land and production of petroleum pipelines for both crude and refined fuel oils will require a lot of power.

“Other activities that will need lots of power include production of petrochemicals, urea; steel products-based manufacturing such as motor vehicle body parts and for earth moving equipment, electrification of rail lines, installation of escalators at shopping malls and airports;
and, new special economic zones,” the President said.

Saying power generation is a profitable venture, the President assured that the Government will continue to strengthen the existing favourable legal and fiscal framework to encourage private participation in the
development of the additional 5000 MW.

President Kenyatta said his Government will also take deliberate steps to encourage investments throughout the country so as to create demand for uptake of power.

He added that the Government had allocated sh. 79.8 billion to support energy sector initiatives and will ensure continued availability of resources to accelerate electricity connections in the rural areas to enhance socio-economic activities at the grassroots.

On fuel exploration, President Kenyatta expressed displeasure with the nature of local politics taking place in areas where these discoveries have been made.

He therefore urged politicians to be in the forefront of facilitating exploration and exploitation of the country’s natural resources.

The Jubilee Coalition, in its manifesto, pledged to improve the country’s energy infrastructure and promote alternative energy sources to create a cost-effective supply regime to spark off an industrial revolution.

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