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Kenya: Energy Sector Insights

13.02.2017
Kenya is an ideal location for renewable energy development as all the main renewable energy sources are available there: wind, solar, geothermal as well as hydropower. Kenyan government is also encouraging investments through various energy programs. Potential growth areas in the near future are among other solar hybrid micro and mini grids projects, last mile grid extension development and development of bioethanol plants. Supply side of energy is and will be emphasized for the near to medium term future. Demand side management is likely to become a focus theme in medium to long term.

While access to electricity in Kenya has rapidly increased over the past few years, about half of the population still lives in darkness. This is partly because many live in communities far from the national grid, making it too expensive to connect them to it. With an ambitious target of achieving universal access to electricity by 2030, Kenya is exploring mini grids for electrifying communities away from the grid. These localized electricity networks - typically harnessing energy from available solar, wind, hydro and biomass - could hasten connectivity for millions of people. Kenya currently has a power generating capacity of ~2,000 MW. This is expected to increase to ~3,400 MW over the next 5 years. Currently hydropower dams and geothermal power plants supply the majority of Kenya’s power followed by fuel oil and coal fired power plants. Significant capacity additions are planned for coal and wind power with a single ~1,000 MW coal power plant and ~300 MW of new wind farms. An interesting detail regarding the Lake Turkana Wind farm is Google’s announcement to buy a share of it, once the completed. IPPs are private investors in the power sector involved in generation either on a large scale or in renewable energy projects under the Feed-in-Tariff Policy. The IPPs contribute ~ 30% to the country’s installed capacity. Kenya is ideal location for renewable energy development as all the main renewable energy sources are available there: wind, solar, geothermal as well as hydropower. Kenyan government is also encouraging investments through various energy programs. Potential growth areas in the near future are among other solar hybrid micro and mini grids projects, last mile grid extension development and development of bioethanol plants. Supply side of energy is and will be emphasised for the near to medium term future. Demand side management is likely to become a focus theme in medium to long term.

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