The Price of Power

How a lack of 'Energy Justice' in Kenya keeps the poor class down

Turkana Wind Farm: So much potential, but politics stands in the way of Kenya's potential for a Green Grid. Photo: National Catholic Reporter

By Mariga Thoithi

The cost of energy in Kenya is implausibly high and ordinary consumers are suffering because of it.

Energy Principal Secretary Joseph Njoroge last year dimmed the hopes of Kenyans who had expected the Energy Bill 2018, which allowed the government to license alternative electricity distributors, to be the solution to their unaffordable energy bills. “We have no intentions of making any sector player insolvent. It is important that all players continue to be financially healthy,” he said.

It ended speculation that finally a solution had been found—a problem that’s caused heated national conversations and a problem that eventually ended up in the High Court. Kenya Power, Kenya’s sole national electricity distributor had been found guilty of illegal billing that had resulted in consumer bills in the tens of thousands to hundreds of thousands of shillings per month for residential housing. What had started off as murmurs and telephoned complaints, resulted in a class action suit, which ended in even more disappointment as the lawyer who had offered to take on the class action suit, Apollo Mboya, settled the matter privately with Kenya Power. His action was seen and reported as a major betrayal to Kenyans at large.

Kenya Power, which eventually admitted to overcharging consumers by over Kshs 10Bn got away with it unscathed by promising to stick to the regulated tariffs and to cover the cost of the suit. It has operated as a monopoly for decades, which has worked to the detriment of consumers and manufacturers for decades.

Several companies have moved to neighbouring Ethiopia and Egypt, citing electricity cost as one of the major reasons why they have relocated their plants, including Eveready Kenya and Cadbury’s.

Kenyan President Uhuru Kenyatta has been on record every year since his term began in 2013 promising to address the high cost of electricity, particularly for manufacturers. Earlier this year, he promised manufacturers a 30 percent reduction in electricity costs, which would be implemented through rebates. He also talked about the government’s investment in alternative energy including solar and geothermal energy. All these promises have however been just that, promises. In fact, through what the Energy Regulatory Commission referred to as harmonisation of charges, electricity prices rose by 30 percent last year. An additional VAT of 16 percent was instituted on fuel, which automatically affected fuel prices, which was later lowered to eight percent after a nationwide uproar.

The conversation on alternative sources of energy, however does bring up questions over the options Kenya has, their viability and why they haven’t yet been implemented.

According to the Ministry of Energy, Kenya has a capacity of 2,250 MW against a demand of 1,640MW. Kenya primarily relies on hydroelectric energy (50 percent) though it’s been attempting to move away from it because of the effects of climate change, which have led to increased drought and irregular rainfall.

Though contrary to government efforts to move away from Hydroelectric Energy, the government has signed/is about to sign dam contracts worth around Kshs 700Bn. The contracts have included the infamous Kimwarer and Aror Dams, which were mired in corruption. The dam scandal involved ghost payments and fraudulent contracts, which came up to almost Kshs 30Bn and it involved high level arrests including the Treasury Cabinet Secretary, Henry Rotich, and his Permanent Secretary, Kamau Thugge.

The government has been going in the direction of wind and geothermal energy. One of Kenya’s biggest plants, Masinga Hydroelectric Power Station was already closed down twice last year due to reduced water levels and two others were operating at around one-eighth of their full capacity.

The Lake Turkana Wind Power project is the latest in the addition to Kenya’s power grid. It adds 300MW to the local grid which is approximately 13 percent of the country’s capacity. But even this green and forward looking project was also mired in corruption controversy.

Through an interview with the Standard Newspaper, Kenya’s Energy Minister while acknowledging reduced demand, revised downwards Kenya’s projected addition to the power grid to 7,200MW down from 10,000MW. Kenya’s annual demand growth is nine percent.

Kenya currently has more supply than demand even though government and private sector players are still, against all science and environmental knowledge gained over the past two decades, insisting on going ahead with building a coal plant in Lamu.

John Morangi, Kenya’s Mining Principal Secretary was last week put on the spot over the effects of coal mining on the environment at Jukwaa La Madini, Mafuta na Gesi, a national conference on oil, gas and mining. The PS said that coal could be used well and said that the coal mining would add to Kenya’s energy capacity while having other output including the production of tar and other products from the waste produced.

The PS however pivoted away from the questions around the documented detrimental impacts of coal, which would undoubtedly ruin the lives of hundreds of thousand of Lamu residents through pollution and loss of income through tourism.

One of the biggest causes of high electricity costs is the overproduction of electricity. According to the power production contracts, the government pays for the electricity generated irrespective of the absorption into the grid and so the cost is passed on to the consumer. The Lake Turkana wind plant is an example of that problem, but Kenya’s push for increased production without a plan on how to export it because given the current annual demand curve, it will take years for that to happen.

Kenya’s push for geothermal energy has also seen them map out 23 possible areas to set up plants. Olkaria Geothermal plant already exists and whose power is already on the grid and the Kenya Electricity Generating Company (KenGen) plans to increase their geothermal electricity production. KenGen plans to double its electricity production in the next five years with half of it poised to be geothermal energy which would make Kenya one of the world’s largest Geothermal energy producers.

The geothermal and wind production power brings ecological questions because the location of the plants are around areas with wildlife and ecological factors which would be ruined by the plants. Ol Karia for example, is right next to Hell’s Gate National Park. A tourist to the Park and environmental filmmaker and photographer, Adam Waltz had this description of the Park when he visited it:

“Few tourist guides mention that Hell’s Gate lies at the heart of Kenya’s efforts to become a world leader in geothermal power generation, which means that visitors entering the park via its Olkaria entrance, as I did during a media tour last month, are immediately confronted by infrastructure: Warehouse-like power plants, networks of roads, pipelines snaking over hills, industrial signage, and thickets of power lines. Towering plumes of steam rise from condensers and wellheads scattered to — and over — the horizon. Machine noise is inescapable. A small group of Maasai giraffes browse nearby, a reminder of the area’s legal status as part of a national park.”

Apart from the potential water pollution and toxic gases, the infrastructure can damage the environment, which will certainly affect the ecosystems in the area. The nature of geothermal energy means that it is found in areas with potential environmental impact (locally including spots in parks and reserves) but many of these projects are additionally supported by international organisations investing in so-called ‘green energy’. These organisations include the U.S. Agency for International Development (USAID) United Nations Environment Programme and the Global Environment Facility (overseen by the World Bank.) Hell’s Gate Park, for example was famed as the breeding ground for six different species of vultures, two of which were once declared endangered globally, and now only one species is left.

Researchers had also pointed out that Kipeto Wind Farm, a proposed wind farm, would be ecologically damaging to bird species around the area. However, organisations like Bird Life International and Nature Kenya, which were on record issuing statements against the wind farm in 2017, changed their tune in 2018 after a London-Based investment firm, Actis, bought 88 percent of the farm and put aside $1M for mitigation. They argue that they did it because Actis met conditions that they set for bird protection. Still, energy construction projects have lasting irreversible environmental consequences no matter how well-intended.

The lowest impact option has always lied in harnessing the sun. Solar energy, which has a high initial cost of investment, hasn’t found a solid footing in a country with a bounty of annual sunlight.

So where do we turn for our future energy needs?

Electricity and energy will seemingly remain a problem for a while unless policy and government initiatives are made to address the unique scope, balance and needs of Kenya’s population, environment and politics.

The most promising outcome Kenya has is movement towards geothermal and wind energy. This seems promising given the most recent addition to the grid, The Lake Turkana Wind Farms and the investment in geothermal energy. Back in 2018, President Uhuru Kenyatta made a promise that Kenya would move to 100 percent renewable energy by 2020. Though in practice that isn’t feasible by next year, but practical steps are being made towards it in order to reduce our reliance on hydroelectric energy.

Kenya’s running on 70 percent renewable energy according to the World Economic Forum, which is three times the global average and so it’s within sight that Kenya would become 100 percent green in the next five to ten years if the push is sustained.

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