NAIROBI, Kenya, Apr 26 – The National Economic and Social Council (NESC) says Kenya should explore setting up a nuclear power plant.
While acknowledging that it would take several years to realise it, the Council’s Secretary Julius Muia said it would be prudent to start the preparations for the program early to establish its viability and effectively plan for the plant which would ensure the provision of cheaper and reliable energy to Kenyans in the long term.
“The gestation period for a nuclear plant is seven years so we need to think about it now so that if it’s viable, the country can go nuclear by 2030,” he said.
The government expressed its desire to generate about 1,000 Megawatts of nuclear energy which would help the country reduce its over reliance on hydropower in 2008 and estimated that such a plant would cost the country about Sh77 billion to put up.
A team of experts was invited to explore whether the country would be able to utilise this nuclear capacity but they didn’t report back on the project’s feasibility. Mr Muia however said consultations are still ongoing.
In 2009 during a meeting in Vienna, Prime Minister Raila Odinga received a pledge from the International Atomic Energy Agency which agreed to partner with Kenya to help it pursue its quest for nuclear energy as an alternative source of power.
Although it is expensive to establish, nuclear capacity is preferred the world over as it is a clean and cheaper form of energy.
At a press briefing to announce the Council’s deliberations that were held between April 9 and 10, Mr Muia said as a way of reducing the cost of electricity in the country in the short term, discussions were ongoing between the Ministry of Energy and Treasury. He hinted that the outcome of the talks might be made soon.
In October 2008, the government reduced the Value Added Tax on electricity from 16 percent to 12 percent but the business community and manufacturers who particularly suffer from high power costs complain that this has not been enough to cut their operational expenses.
During the briefing, the Secretary disclosed that the Council also discussed ways of strengthening the steel industry by exploiting the substantial deposits of iron ore, coal and limestone in the country.
“Development of iron and steel industry in the country will help catalyse industrial growth and save the more than Sh60 billion (that) Kenya spends annually on importation of steel products,” he added.
The fast-tracking of the upgrading of the Jomo Kenyatta International Airport to strengthen its competitiveness as a regional transportation hub, need for reforms in the City Council of Nairobi’s inspectorate department and the necessity for specific programs to address the problem of youth unemployment were all recommended as areas that would go a long way in enabling the country to achieve its long term development goals as outlined in the Vision 2030.
At the same time, the Council observed that improved financial conditions in the international markets present an opportunity for the government to float the long awaited Eurobond.
The liquidity in these markets means that time is ripe for the government to raise development funds abroad.
Plans to raise $500 million from the foreign market were hatched in October 2007 but were suspended months later due to a myriad of factors including the 2008 post election violence and the global financial crisis.
Mr Muia was however guarded on the structure of the bond and when it was likely to be issued.
“At the moment, I cannot comment on how the Eurobond will be structured because this arises out of the advice of professionals in that area. But as and when we are ready to issues, the details will be available in terms of the time structure and any other conditionalities that are tied to the bond,” he added.