Time flies with great content! Renew in to keep enjoying all our premium content.
Parliamentary approvals of PPAs will provide critical oversight
Parliament should come up with licensing protocols that ensures transparency in selection and licensing of investors, a key requirement for PPP engagements.
A Bill will be placed in Parliament to require parliamentary reviews of Power Purchase Agreements (PPAs) for various Independent Power Producers (IPPs) prior to licensing.
Parliament had last year suspended new PPAs pending review of licensing terms. The proposed legislative action is timely considering previous absence of transparency in licensing of IPPs, a situation which may have increased power costs.
Resumption of IPPs licensing will avert Kenya running out of generation capacity to meet increasing national demands.
Current installed capacity in Kenya stands at 3320 MW of which about 2344 is the available capacity. National peak demand recently hit 2240 MW, which left a dangerously low buffer capacity to cover demand spikes, which are currently bridged by imports from Ethiopia and Uganda.
Parliament should come up with licensing protocols that ensures transparency in selection and licensing of investors, a key requirement for PPP engagements. Further parliament legislate guiding principles in selection of a generation mix that meets wider strategic economic and environmental policies.
Past experience tells us that power generation investors are a mix of competing technologies and interests, a situation that often creates conflicts when deciding on most optimum generation mix.
To avoid conflicts, there is need for an independently and professionally prepared strategic power generation master plan that justifies various types of generation (hydro, solar, geothermal, wind, nuclear etc) and their locations.
The principle of prioritising indigenous energy should be paramount to avoid imported inputs (oil, coal, natural gas, LNG) which are subject to global commodity price volatility, with huge implications on consumer power prices and balance of payments.
For the same reasons, imports of electricity should be kept to bare minimum.
Further, we should not shy away from using Turkana oil and Kitui coal to generate power. Directionally, it should never be imported coal or oil for power generation. Every country in the world that has fossil fuel resources is making the most economic use of them, even as prolonged and inconclusive climate debates continue.
Grid-scale solar power generation should be prioritised, as long as its installation is supported with battery storage capacity to make it baseload and available during evening peak demands. Off-grid solar should be widely encouraged and supported due to its flexibility to speedily electrify various aspects of our economy.
I believe in economies of scale by going for larger power generation units with lower capital and operating unit costs, instead of the routine plants below 50MW that we see in Kenya. Units above 200 MW will definitely deliver lower unit costs and feed-in tariffs.
