Economy

Rising electricity demand pushes Kenya on verge of rationing

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Kenya Power workers at work along Nyerere Avenue in Mombasa. PHOTO | KEVIN ODIT | NMG

Kenya’s demand for power rose to 2,117 Megawatts (MW) in July in what saw its buffer capacity drop below the 100MW mark, sparking fears of power rationing from January.

The increase in consumption prompted the government to speed up a deal to import cheap electricity from Ethiopia, to shield the country from the prospect of power rationing.

Energy Cabinet Secretary Monicah Juma disclosed that the peak was recorded on July 26, marking a rise from 2,036 MW in November last year.

Kenya’s available power is 2,200 MW and the jump in demand reduced the country’s headroom of extra capacity from 140MW to about 80MW.

Kenya will from November import 200 MW of electricity from Ethiopia for three years to 2025 which will rise to 400 MW, a deal that Dr Juma says has saved the country from the possibility of power rationing.

“Kenya Power and Lighting Company and Ethiopia Electric Power counterparts inked a most significant PPAs deal – the provision of 200MW of renewable energy to our grid, at a very competitive rate, commencing in November of 2022,” Dr Juma told journalists on Friday.

“The effect of this is that we have secured the country from what was a real possibility of load shedding starting in early 2023."

Load shedding happens when a distributor switches off power supply to a group of customers because the entire system is at risk. Power distributors adopt load shedding to ease pressure on a primary source when demand is greater than the primary power source can supply.

Economic activities have remained on a steady rise since last year when the government eased Coronavirus-induced curbs that had significantly hurt demand for electricity due to a slowdown in the economy.

An outlook from 14 global banks and consultancies projects economic activities to expand 5.3 percent this year highlighting the possibility of a further increase in peak demand for electricity.

But the rebound in demand continues to pile pressure on the country's available electricity capacity and an ageing Kenya Power system, making it unreliable for businesses.

Kenya signed a 27-year power-sharing deal with Ethiopia where Kenya Power will from November import the electricity at lower tariffs, increasing the available capacity and at cheaper rates.

The rates have not been disclosed but will be lower than the current tariffs offered by Independent Power Producers.

The State-owned utility buys the bulk of its power from Kenya Generating Company at Sh5.3 per kilowatt-hour (kWh) but other IPPs have priced their power as high as Sh195 per kWh.

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