Kenya plans to more than double the amount of electricity that the power producers can generate - a move that would see consumers pay dearly to support idle power.
This as the State continues to pursue the combination of adequate energy to fire industries as well as the elusive cheap power. This would however see consumers foot the extra bill.
National Treasury Budget documents indicate the government plans to increase the country’s electricity generation capacity to 6,700MW from the current 2,819MW.
Treasury said this would enable the country to have adequate power to cater for industries as well as Kenyans, with its aim of achieving universal electricity access.
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The State has also earmarked coal as among the sources of power that will enable the country to grow its power generating capacity and lower the cost of electricity.
“Going forward, the government is set to boost power generation from the current 2,819MW to over 6,700MW with major energy sources being geothermal, coal, and wind, solar and hydro,” said Treasury in the draft Budget Policy Statement published this week.
The statement was, however, not specific on the timelines for increasing the generating capacity.
It noted that this would be essential in meeting the government’s goal of universal electricity access, which is expected to be met by end of 2022. “This will enable connection of an additional 2.4 million new households through the grid and off-grid solutions to achieve universal electricity coverage by the year 2022 from the current 75 per cent access,” said Treasury.
“To achieve this, 3,082.9km of additional transmission lines are set for construction, setting up of 37 transmissions and 45 distribution substations to improve system reliability and stability and reduce electricity losses.”
While increasing power consumers by 2.4 million new customers from the current 7.9 million would offer a huge market for the power industry players, an electricity generating capacity of more than 6,000MW is high, going by the current consumption standards.
It could see consumers paying for excess power generated, eroding the idea of bringing down the cost of power.
Currently, Kenya has an installed electricity generating capacity of 2,819MW while peak demand stands at about 1,938MW, pointing to an excess capacity of about 30 per cent.
While it is a globally accepted practice to have excess capacity to take care of incidences such as breakdowns or routine maintenance of power plants, it is costly for consumers as the excess capacity is usually factored in their power bills.
When power plants produce more than the market can absorb, the consumers have to pay what is referred to as capacity charges.
This fee is what power plant owners earn when they do not supply power to the grid, but have their plants ready to dispatch power to the grid.
Treasury noted that heavy investments in energy would lower the cost of energy and also enable the government to increase connectivity to cover all public facilities.