Kenya seeks Sh368b for energy

October 22, 2009

, NAIROBI, Kenya, Oct 22 – The government has said it requires a massive Sh368 billion over the next five years to finance various energy sector developments in the country.

Energy Minister Kiraitu Murungi said on Thursday that the government would only be able to raise 46 percent of the amount and appealed to the private sector and development partners to help raise the balance.

“Our strategy for having reliable power and security of supply in this country lies in the exploitation of geothermal power. We are trying to raise $4.9 billion which is a lot of money and that’s why we are inviting donors to finance the gap,” he said on the sidelines of an electricity access donor meeting to drum up support for investments in the sector.

Kenya has an estimated capacity of 7000MW from geothermal energy alone but an installed capacity of 1200MW.

“We need Sh56.5 billion ($753 million) for Geothermal Resources Assessment, Sh112.5 billion ($1.5 billion) for power generation of at least an additional 2000MW, we need Sh35 billion ($464million) for electricity distribution and Sh82.5 billion ($1.1 billion) for rural electrification,” he said.

The requirements are contained in the newly launched 2009-2014 Kenya Electricity Access Investment Prospectus which outlines the measures that need to be undertaken to enable the country meet the projected 2029 Megawatts (MW) power demand by 2013/2014.

Several reform measures have already been undertaken in the electricity sector to liberalise it, spur investment and improve efficiency in service delivery.

These developments have seen the Geothermal Development Company and the Kenya Electricity Transmission Company set up to pursue geothermal steam field development and develop high voltage power transmission lines respectively.

Mr Kiraitu said electricity production and distribution was critical in enabling the country to achieve its development goals.

In response to this, the minister directed his Permanent Secretary to meet with the KenGen, KPLC, Energy Regulatory Commission and the Rural Electrification Authority and develop a comprehensive plan that would ensure power availability in all seasons.

The Comprehensive Power Generation Plan would enable the country to plan ahead and avoid recent scenarios of chronic power shortage in the country.

“We must have power in Kenya during the rainy seasons, we must have power when there is drought and at all times,” he said.

Speaking at the same forum, World Bank Country Director Johannes Zutt concurred with the minister and explained that limited access to modern energy was impacting negatively on Kenya’s GDP growth thus the need to urgently address the situation.

According to a survey they dubbed the ‘African Infrastructure Country Diagnostic’ showed that Kenya loses approximately 1.5 percent of its GDP growth every year as it is not able to supply the modern energy needs of the current economy.
His remarks came even after the government admitted that it would not be able to achieve its target of connecting about 20 percent of the rural population by 2010 despite extending the medium voltage power grid within reach of the 63 percent of the population.

Currently only about 10 percent of the rural folks are connected to electricity.

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