Skewed deals between Kenya and power firms spark price shocks

A number of flawed purchase contracts between government and Independent Power Producers (IPPs) has left Kenyans paying billions of shillings for electricity they are not consuming, preventing the cost of power from going down.

Electricity consumers are still being forced to pay 25 private thermal electricity producers despite heavy investments that have increased the country’s power production capacity. The country currently has a generation capacity of 2,303 Megawatts (MW) but its peak demand is 1,640 MW. Thermal power producers who use diesel only contribute 522MW, which means without their input, other energy sources can produce 1,781MW, which is more than the country’s demand.