Plans to generate electricity from solar, wind gather steam

What you need to know:

  • Investors are unveiling project proposals even as the Energy ministry conducts an audit to weed out firms that may have obtained licences simply for speculation

Investors are rushing to announce plans to invest in power generation from renewable energy sources in response to a government directive issued last year.

Smart Company has established that the ministry of Energy and Petroleum has embarked on an audit to establish the level of compliance with the requirements for such investments in a bid to weed out firms that have held licences for power generation but are yet to set up plants.

A circular issued by Energy Cabinet secretary Davis Chirchir in July, last year, directed all investors who had been cleared to generate electricity from solar, wind, co-generation and biomass to file status reports on their progress by the end of last year.

“We wrote to all investors who had expressed interest in developing power generation from renewable sources to work around their timelines. We asked them to formally engage us through the department of renewable energy because a number of them were taking too long to work on the proposed power plants,” said Mr Chirchir.

It is understood that the department of renewable energy is scrutinising submissions by the firms, estimated to be about 100, before compiling a report that will inform the next course of action.

However, insiders say the government is considering revoking some licences since some investors are suspected to be speculators.

Proposed projects worth billions of shillings have been declared since the circular was issued.

In November last year, Civicon, a subsidiary of Transcentury Investments, HydroChina Corporation, Aperture Green Power and Saron Marketing announced a plan to set up a 50 megawatts wind farm in Limuru.

Construction of the $130 million plant is expected to start in March, although the investors are yet to enter into a power-purchase agreement with Kenya Power to provide details about the price at which they will hook the energy to the grid.

“The potential for wind energy generation in Kenya is significant and we shall be using the Limuru wind farm as a pilot programme to tune our delivery capacity,” said Mr Gachao Kiuna, Transcentury chief executive.

Towards the end of last year, another investor, Chagem Power, unveiled a plan to set up a 50 megawatts wind power plant in Kajiado County.

This month, the National Environment Management Authority invited public input on the proposed farm, which will be set up on 40 hectares in Loradiak, 10 kilometres from Kona Baridi, off Magadi Road.

It will cost about Sh4.8 billion which will be obtained from China Exim Bank. The project is associated with Jamii Bora Bank chairman James Mwangi Gacheru and Martin Kinoti Kinyua, chief executive of GEM-CM Construction Ltd.

Construction of Kipeto, another wind farm with a capacity of 100 megawatts also within Kajiado County, is set to start in March.

It is expected to cost Sh27 billion. Craftskills Wind Energy International, the investor behind the project, is reported to have secured Sh17 billion from the US-based Overseas Private Investment Corporation to finance the building of the plant.

Other investors who have expressed interest in setting up wind power plants include Belgium’s Electrawinds with a proposal to set up a 90 megawatts plant in Lamu, at a cost of Sh19.8 billion and Bluesea Energy, which is eyeing a 40-megawatts wind power plant in Meru.

Kenya Electricity Generating Company (KenGen) is currently the only company that is supplying wind power.

The state-owned generator recently increased the capacity of its wind farm located at Ngong Hills from 5.1 megawatts to 25.5 megawatts after it secured funding from the governments of Belgium and Spain. KenGen has also expressed interest to invest in a 100 megawatts wind power plant in Meru County.

Generation from renewable resources such as wind and solar is yet to match other sources of power in the country’s generation mix such as geothermal, hydro and diesel-powered sources.