Kenya to woo electricity investors at Africa Energy Forum

Kenya will be bidding for foreign investments in electricity at the upcoming Africa Energy Forum scheduled to take place next week in Istanbul, Turkey.

Representatives from the Ministry of Energy and Petroleum are expected to outline measures the government has taken to transform investment policies and regulations, specifically those related to foreign direct investments.

“The need for countries to compete was highlighted at the World Economic Forum in Nigeria earlier this month when questions were asked about the ability of some countries to attract foreign private sector investment.

“It is clear that for these nations, the credibility is there and that capturing investment is of paramount importance,” reads a brief on the event.

Traditionally, Africa has been the least attractive investment destination in the world in terms of power generation due to poor infrastructure that has made several projects “lack bankability”.

Kenya will be represented by Ministry of Energy and Petroleum principal secretary Joseph Njoroge alongside board members from the Kenya Electricity Generating Company (KenGen), director-general of the Energy Regulatory Commission Fredrick Nyang and bosses of other parastatals in the energy industry.

Besides Kenya, representatives from South Africa, Nigeria, Mozambique, Tanzania, Cameroon, Namibia, Ghana and Zambia are expected to attend.

The Africa-Turkey co-operation is likely to take centre stage, given the choice of venue for the conference.

Kenya struck economic agreements with Turkey in April during President Kenyatta’s visit to the European country. Some of the deals were on the development of the energy industry.

The Turkey forum comes at a time when the government is pursuing a plan to generate additional 5,000 megawatts of electricity in 40 months starting September last year.

Electricity cost

While about half of this capacity is expected to come from KenGen, the plan by the government shows that there are slots for independent power producers.

Kenya Power is currently implementing a Sh13 billion plan to refurbish its electricity supply network.

Under the project, existing substations and distribution lines across the country will be upgraded and new ones set up in some areas.

It is expected that the additional power will enable the government to cut by half the cost of electricity to $9 cents per unit, hence attract investments in the manufacturing industry.

At the moment, according to the Kenya National Bureau of Statistics, the manufacturing segment grew at a mere 4.8 per cent last year, despite its big potential to boost economic growth compared to agriculture and tourism which are prone to challenges such as weather, security and fluctuating prices in the international markets.

Nuclear energy

Besides plans to generate power from renewable sources such as geothermal and wind as well as cheap sources like coal and liquefied natural gas, Kenya also seeks to develop electricity from the capital-intensive nuclear energy.

Under the nuclear energy programme, the government hopes to generate 1,000 megawatts by 2030.

The Turkey forum will offer the Kenya Nuclear Electricity Board an opportunity to showcase the progress it has made in setting up a legal framework to guide exploitation of nuclear energy resource.