A lack of funds to implement capital-inten- sive geothermal projects has forced the authorities in Kenya to shift to coal- powered plants in an effort to achieve a gener-ation target of 5 000 MW by 2017.
Says the Ministry of Energy and Petroleum: “Government has identified coal as one of the sources of energy that will drive the development of strategic initiatives [under] Vision 2030.”
As part of the new drive, the government of Kenya has invited expressions of interest from private investors keen to develop the Lamu coal-fired power plant, which will have capacity to generate 900 MW to 1 000 MW. The plant will be located on the Indian Ocean coast, in Lamu county.
The selected investors will develop the power plant on either a ‘build, own and operate’ or ‘build, own, operate and transfer’ basis and sell the electricity to Kenya Power.
Besides the Lamu project, which will use imported coal, the Kenya government intends to invest in another coal plant of the same capacity in Kitui. The Kitui plant will use coal from the Mui Basin coal project.
The decision to invest in coal power plants came after it had dawned on the Kenya govern- ment that several planned geothermal plants might stall owing to financial constraints. Kenya, East Africa’s largest economy, requires a staggering $4.5-billion over the next three years to implement earmarked geothermal projects.
To generate at least 5 000 MW from geo-thermal sources by 2030, the country requires a mind-boggling $20-billion.
Government projections indicate that power demand will reach 15 000 MW by 2030. To meet that demand, the country must raise the current capacity of 1 664 MW to 18 000 MW.
“It is anticipated that electricity demand will rise sharply as new county governments take shape and numerous energy-intensive economic activities spring up in the counties,” says the Energy and Petroleum Ministry.
Kenya is currently implementing a devolved system of government, consisting of national government and 47 county governments.
According to the Ministry, interested inves-tors must have a proven record in the design, financing, construction, maintenance and oper-ation of coal-fired power plants and electricity generation facilities.
To be prequalified, interested bidders must provide evidence of financing at least one power project costing a minimum of $500- million and demonstrate the ability to raise at least $1-billion at competitive rates.
The bidders must also provide evidence that they have designed and constructed at least one coal-fired power plant with a minimum capacity of 600 MW and have had operation and maintenance experience on a 450 MW plant for at least five years.
For its part, the Kenya government will acquire the land for the project, while State-owned Kenya Electricity Transmission Com-pany will build a 400 kV transmission line to evacuate power from the generation plant.