Kenya: Prepare for Higher Power Costs in Coming Months, Warns ERC

Increasing use of thermal sources of energy will see the cost of power go up in the coming months, sector regulator has said.

The Energy Regulatory Commission says more power from generators will be looped into the national grid as rainfall projections for the year remain lower, overriding the benefits gained from use of wind and solar sources.

Commission director general Pavel Oimeke said although the regulator was finding it difficult to make precise projections on the expected incorporations of the thermal power due to changing weather forecasts, consumers should expect a higher fuel cost charge.

Fuel energy

"We expect very low hydro and high thermal dispatch between April and May. Generally, fuel energy charge is expected to be much higher," Mr Oimeke wrote in a text response to queries.

Kenya has just been through its worst drought in 38 years according to the Intergovernmental Authority on Development (Igad), setting households for food shortages, water scarcity over and above the pressure on electricity bills.

The below-average rainfall during the so-called long rains season from March to May has seen both the World Bank and the Central Bank of Kenya lower economic growth forecast in which the cost of power plays a critical role.

The fuel surcharge levy -- which is influenced by the share of electricity from diesel generators -- has been on the rise from Sh2.45 in January to Sh2.50 in September and currently stands at Sh2.75 per KWh (unit).

ERC data shows that drought has seen generation from the cheaper hydro sources drop by 39 per cent or 163 million kilowatt hours (kWh) between August and February.

The reduction has wiped out the benefits of the additional 151 million kWh of wind and solar power that were injected in the grid over the same period and dimming hopes for cheaper electricity promised by the government after billions of shillings' investment in the two green sources.

The Sh70 billion Turkana wind farm, which was switched on in October, injected 146 million kWh in February, while the Sh13 billion Garissa solar plant supplied seven million units.

Last week, Energy Cabinet Secretary Charles Keter said consumers could have been worse off without the solar and wind power -- which accounted for 17 per cent of the power consumed in February.

"We would have been rationing power now and all that contribution you see from wind and solar would be coming from thermal," Mr Keter said in a phone interview.

To save consumers from the power rationing, the government will now be forced to hook in the expensive thermal power whose presence on the grid had dropped by 18 million KWh in February compared to August and accounted for 11 per cent of electricity injected into the grid.

The Ministry of Energy may also be forced back to the drawing board to slow down the retirement of thermal power plants whose phase out was expected to be complete as early as 2022 according to ERC projections.

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