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Department of Trade and Industry


The Quarterly Newsletter for the UK New and Renewable Energy Industry

May 1998


Kenya suffers an acute shortage of energy. It is estimated that supply is some 120MW less than demand, a shortfall equating to 15% of Kenya’s current installed generating capacity of 800MW. Considerable effort is therefore being made to improve the access of domestic and industrial sectors to high-quality and firm electricity supplies. In parallel with this is an ongoing desire to develop successful and sustainable markets and industries - including those for renewables technologies.

Reform of the energy sector is under way, with the Energy Sector Reform and Power Development Project (ESR&PDP) the main vehicle. This is a major, US$800 million initiative developed by the Kenyan Ministry of Energy, the local electricity utility and the World Bank.  The objective is to create an efficient and environmentally sustainable energy sector capable of supporting the investments needed to efficiently meet future power demands.  In particular, it aims to:


Wind-powered water pump, Malindi

  • finance investments needed to meet power demand and improve operational efficiency in the power subsector
  • reform the subsector’s organisational structure to enable operating entities to function efficiently and on a commercially sustainable basis
  • create a legal and regulatory environment suitable for private sector participation
  • support the adoption of economic pricing and the implementation of demand- and supply-side efficiency improvement measures
  • develop indigenous geothermal resources and a strategy for sustainable household and rural energy development.

Hydro scheme (with biomass trees in background) at Kericho tea plantation

Renewables technologies are expected to play a significant role in the ESR&PDP. Their current status is as follows:

 Solar.  Kenya’s equatorial location means it has an excellent solar resource, which, coupled with its sheer size, ensures that demand for stand-alone energy supply is large. This is already being tapped by a small, dynamic solar PV sector that is successfully introducing both professional and solar home systems in the remoter parts of the country. The PV industry has grown up essentially free from government intervention and currently sells in the order of 20,000 modules a year. The success of this market has been followed with interest outside the country, and is one reason why Kenya has been selected, alongside others, to participate in the World Bank PV Market Transformation Initative (PVMTI). Solar hot water systems (imported and locally manufactured) also sell into a commercial environment, with, for example, a significant proportion of the hotel sector accepting this technology as the norm.

 Wind. Kenya has a significant wind resource. This has long been harnessed for water pumping but remains largely unexploited as far as electricity production is concerned. The resource is concentrated mainly on the coast and in hilly areas (with a demonstration site existing in the Ngong Hills). However, good wind-speed data are lacking across the country, a situation it is hoped to rectify using United Nations Development Programme - Global Environment Facility (UNDP-GEF) funds.

 Biomass. Kenya’s economy is effectively based on agriculture and tourism. The agricultural sector spans the production of tea, coffee, sugar, sisal, palm oil etc. As well as being major energy consumers, these subsectors tend not to follow global trends insofar as they rarely use residues or energy crops to do more than meet their own captive demand. Only fairly recently have organisations begun to look at activities such as bagasse-fired cogeneration, cogeneration using sisal boles and anaerobic digestion of suitable wastes.

 Hydro. Some 75% of Kenya’s current electricity generation is from large-scale hydro, but there is also a sizeable small-scale resource. This is harnessed in some areas (eg many of the remote tea estates meet their captive power demands from small hydro), but in others exploitation is lower. Indeed, in some central and western regions, schemes were abandoned in the 1960s-70s because of a lack of skilled personnel and spare parts, coupled with the growth of the national grid at that time.

 Geothermal. Kenya has significant geothermal potential. The Olkaria high-enthalpy site in the Rift Valley already generates 45MW, and two more 64MW schemes have been submitted for consideration as new Independent Power Producer capacity under the ESR&PDP; one of these has now been awarded a contract.

Overall, this is an interesting and exciting time for Kenya. The economy is beginning to grow again, and consequently energy demand (which, as noted above, already outstrips supply) is predicted to rise by 4-6% a year. Against this backdrop, market reforms and liberalisation have been introduced, with the result that new independent players are entering the marketplace. Taken together with good resources and favourable market conditions, these factors mean the immediate future for renewables in Kenya is bright.

For more information, contact Garry Staunton, ETSU, Tel: 01235 432494, Fax: 01235 433213, e-mail: ; or Chris Smart, British High Commission, PO Box 30465, Upper Hill Road, Nairobi, Kenya, Tel: 00 254 2 714 699; Fax: 00 254 2 719 082.

NEW REVIEW is produced by ETSU on behalf of the DTI. Views expressed in the publication do not necessarily represent the views or policies of the Government or the views of ETSU.  Neither the DTI nor ETSU endorses any of the products or services featured in NEW REVIEW. Please address correspondence to: Dr Barry Hague, Editor - NEW REVIEW, ETSU, Harwell, Didcot, Oxon OX11 0RA. For more information about the DTI's New and Renewable Energy Programme, contact: New and Renewable Energy Enquiries Bureau, ETSU, Harwell, Didcot, Oxon OX11 0RA; Tel 01235 432450/433601, Fax: 01235 433066

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