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Private sector producers of electricity in Kenya have today announced the launch of the Electricity Sector Association of Kenya (ESAK).
ESAK comprises of Independent Power Producers (IPPs), private participants in development of captive power plants for commercial and industrial facilities, as well as participants in the electricity transmission and distribution value chains.
In a keynote address read on his behalf by Mr. Erick Mwangi, the Economic Advisor to the Ministry of Energy, Chief Administrative Secretary in the ministry, Zachary Ayieka, said electricity access rate had grown from 20 percent in 2013 to over 80 percent currently.
“Kenya today has the biggest single biggest wind power plant in Africa in the 310MW Lake Turkana Wind Power Project. We rank seventh globally in Geothermal installed capacity in addition to over 90 percent of the energy in the Kenyan Grid being renewable. The transmission system has also improved with 2,424 km of transmission lines and thirty-three transmission substations constructed”, he said.
In recent past, there has been an outcry from the public and investors in Kenya’s manufacturing sector over the rise in power costs, and which has been blamed in part on the IPPs who form part of the membership of ESAK. IPPs account for more than 30% of the near 3 Gigawatts installed capacity on and tied to the Kenyan grid currently fed with power from wind, solar, thermal, hydro and biomass plants.
ESAK now lends a voice to this critical stakeholder in the Kenyan energy and electricity ecosystem, under the auspices of The Kenya Private Sector Alliance (KEPSA), the apex body of the private sector in Kenya.
George Aluru the ESAK Chairperson, said the main goal for ESAK was to harness the abilities of the private sector in contributing to the development of a sustainable sector. The first order of business for ESAK he said would be to address the negative publicity around IPP participation in the power sector and outlining an agenda around delays in licensing and approvals leading to long lead times and high development costs.
“The association is seized with a myriad of challenges, chief of them being how to support economic growth by attracting investment in electricity, while ensuring sustainability where the customer, utilities, and generators all benefit equally,” said Aluru.
Others are the lack of stability in laws especially around taxation as well as supporting the current focus on the financial stability of Kenya Power, the sole off taker of locally generated electricity capacity.
“ESAK supports the activities geared towards improving the wellbeing of Kenya Power and we welcome any collaboration with the Government to this end. We acknowledge that there is insufficient understanding around IPP involvement and how the sector works. ESAK will continue to constructively engage stakeholders offering partnership, data-driven and accurate information on the state of the sector”, said Aluru.
Victor Ogalo the Deputy CEO at KEPSA in charge of Competitiveness and Operations said despite the current challenges, Kenya’s energy sector is well developed with widespread private sector participation compared to other developing countries.
“The ongoing further unbundling of the sector under The Energy Act 2019 is also expected to allow for increased competition in the generation, transmission, and retail of electricity with anticipated direct consumer gains in improved efficiencies and cost reductions while attracting further private sector investments”, he added.
Towards the achievement of universal access to electricity, Ogalo noted that as of April 2021 over 7.5 million households are already connected to the national power grid. Data from the Energy and Petroleum Regulatory Authority (EPRA) shows the Kenya’s current energy mix as 38.6 percent geothermal, 36.1 percent hydro, 14.2 percent wind, 9.2 percent thermal, 1.4 percent imports and 0.7 percent solar.
“The energy sector is key to powering our prosperity as a nation by unlocking faster economic and social development and anchoring our industrial development targets. We have more than sufficient energy resources to meet these needs and we need to fully develop these resources”, said Ogalo.
The formation of ESAK he added now completes a key step in the engagement agenda with power consumers, investors, and Kenya Power to ensure the increase in access to affordable, reliable, sustainable, and modern energy – an objective enshrined in Kenya’s National Electrification Strategy and the UN Sustainable Development Goal 7 (SDG 7).
ESAK which was registered in 2019, and currently representing forty members will be overseen by a board consisting of seven members and a secretariat with George Aluru – Chairperson, Juliana Kainga – Vice Chairperson, Mike Nyangi – Treasurer and Ivy Muriungi – Secretary.