Sh83bn wind and solar plants fail to cut power prices

Injection of cheaper electricity from Sh83 billion solar and wind power plants has failed to lower bills for homes and businesses.

The government had promised cheaper electricity from increased use of the two green sources by reducing the use of costly thermal power and ultimately cutting the fuel cost adjustment levy in bills.

But filings from the Energy Regulatory Commission (ERC) show that the fuel surcharge levy — which is influenced by the share of electricity from diesel generators — continues to rise.

The fuel levy is currently Sh2.75 kilowatt hour (kWh), up from Sh2.45 in January and Sh2.50 when Kenya started injecting huge quantities of wind power to grid.

The Sh70 billion Turkana wind farm, which was switched on in October, is now injecting up to 300 megawatts (MW) into the grid in some days, while the Sh13 billion Garissa solar plant is supplying 48MW since early November.

Poor weather

Maintenance of geothermal plant and reduced performance of hydropower dams during poor weather has made it difficult for homes and businesses to feel the impact of cheaper wind and solar power.

Electricity from the wind park will cost Sh8.7 per unit (8.5 US cents), which is in a similar price range as geothermal and solar power, or three times cheaper than diesel-generated electricity.

In January, ERC said power from Lake Turkana plant saw wind overtaking thermal generators’ contribution to the overall energy mix.

The increased cheap and clean energy, previously at below two percent of total generation, will turn the spotlight on the energy sector regulator amid pressure to pass the benefits to consumers through lower electricity bills.

Geothermal accounted for 44.6 per cent of electricity generation mix, while hydro camde second at 29.8 per cent, according to ERC data in January.

Thermal, which was at 24.5 percent in December 2017, drops to just 9.6 percent with wind at 14 per cent.