Commercial energy is dominated by petroleum and electricity, while wood fuel provides energy needs for domestic use, especially in rural communities and the urban poor. At the national level, wood fuel and other biomass accounts for about 68 per cent of the total primary energy consumption, followed by petroleum at 22 per cent, electricity at 9 per cent and others sources of fuel (including coal) standing at less than 1 per cent. Solar energy is also extensively used for drying and to some extent, for heating and lighting. However, its consumption in Kenya is extremely low standing at 121 kilowatt hours (KWh) per capita (compared to 503khw in Vietnam or 4,595khw for South Africa). The national access rate stands at approximately 15 per cent, while the access rate in the rural areas is estimated at 4 per cent.

Overall, the utilisation of coal fuel has remained low in Kenya, despite international prices having been reasonable and fairly stable over the years relative to petroleum. The Government has continued to finance the extension of electricity supply in rural areas as part of the basic infrastructure to stimulate economic growth and employment creation. In this regard, the Rural Electrification Authority (REA) came into operation in July 2007 to fast-track the Rural Electrification Programme (REP). Current policy provides for the extension of electricity to market centres, public secondary schools, youth polytechnics, health centres, and water systems, among other community projects. This is intended to increase the access to electricity which in rural areas currently stands at 4 per cent but is projected to increase to 12 per cent by the year 2012.

Moreover, Ethiopia and Kenya have undertaken a feasibility study to facilitate the transfer of electricity to Kenya from a number of large Ethiopian hydropower projects that provide power at lower costs compared to local ones. Feasibility studies on two regional inter-connectors – Nairobi-Arusha and Jinja-Lessos are complete, while the Ethiopia-Kenya inter-connector is currently ongoing. Feasibility studies on three wind turbines are complete, as are two pre-feasibility studies: one on co-generation and the other on solar water heaters respectively. Seven other studies were completed: two studies on the penetration of energy-saving cook stoves in Kenya; one each on power market design and pre-privatisation; geothermal development company, and unbundling of KPLC; Geothermal reservoir optimisation and SCADA/EMS system study.

With regard to policy, Sessional Paper No. 4 of 2004 on Energy Policy was put in place and a new sector legal framework; the Energy Act, 2006, enacted to operationalise the policy framework. Further, the Energy Regulatory Commission was established as a single sector regulator for the energy sector and an Energy Tribunal set up to arbitrate disputes in the sector. A Rural Electrification Policy was also developed to enhance the implementation of the Rural Electrification Programme.

Development projects recommended under Vision 2030 and overall economic growth, will increase demand on Kenya’s energy supply. Currently, Kenya’s energy costs are higher than those of her competitors. Kenya must, therefore, generate more energy and increase efficiency in energy consumption. The Government is committed to continued institutional reforms in the energy sector, including a strong regulatory framework, encouraging private generators of power, and separating generation from distribution. New sources of energy will be found through exploitation of geothermal power, coal, renewable energy sources, and connecting Kenya to energy-surplus countries in the region.


Programmes and Projects for 2008-2012

  • A total of 215 rural electrification projects, estimated to cost Kshs. 1,483 million, are scheduled to be completed by February 2008. These projects include new isolated power stations being erected at Hola (Tana River district), Elwak (Mandera district), Mpeketoni (Lamu district), Merti (Isiolo district), Habasweni (Wajir district) and Mfangano Island (Suba district) at a cost of Kshs.474 million. All these projects are being funded solely by the Government of Kenya.
  • Apart from government funding, Kenya has also received external assistance for its Rural Electrification Programme. The Government of France is currently financing a rural electrification project to the tune of Kshs. 2.7 billion to cover various parts of the country. Upon completion, the project will facilitate connection of power to 460 trading centres and 110 secondary schools, among other public facilities.
  • The Government intends to spend Kshs. 180 million to provide solar electricity generators to 74 public institutions including boarding primary and secondary schools, health centres and dispensaries in Baringo, Marakwet, Samburu, West Pokot, Turkana, Makueni, Narok, Kajiado, Moyale, Marsabit and Mandera districts
  • The Government has formulated an Energy Access Scale-up Programme through which one million households will be connected with electricity over the next five years at an estimated cost of Kshs.84 billion. The programme will target connecting all major trading centres, secondary and primary schools, community water supply works and health centres in the country. This programme will be financed by the Government as well as development partners.
  • Plans are underway for installation of booster pump stations to double the capacity of the  Mombasa to Nairobi oil pipeline from 440m3/hr to 880m3/hr. 4 booster pumps will be installed in Samburu, Manyani, Makindu and Konza.
  • A study has been completed on the projected demand for petroleum products in the country. The Kenya Pipeline Company has selected an Engineering Design and Construction Supervision Consultant for the construction of a 340km parallel oil pipeline from Nairobi to Eldoret.
  • The Government will also partner with the government of Uganda and Tamoil East Africa limited in a Joint Venture Company for the extension of 352km oil pipeline from Eldoret to Kampala.
  • Construction of 6,000 tonne common user LPG import handling facility in Mombasa through public – private partnership. This is expected to increase parcel sizes imported thus reducing freight costs and making LPG cheaper to Kenyans.
  • Construction of 2,000 tonne common user LPG handling facility in Nairobi. With increased storage space, supply sources will increase thus competitively priced LPG can be obtained.
  • Following the completion of appraisal drilling in Mui Basin of Kitui and Mwingi district, Kenya will have access to local coal as an every source. Initial exploration activities have indicated existence of coal. Appraisal drilling project to ascertain the commercial quality and viability of the deposits are in progress.
  • Olkaria IV appraisal drilling of 6 wells are expected to produce 70 mw of electricity. The project is expected to prove that commercially exploitable steam is available in the field.
  • Wind Power Generation by IPP’s at various sites. It is envisaged that wind power will provide total power installed of about 150mw.
  • Co-generation Power: Power will also be obtained in the process of producing sugar. It is envisaged that the potential of about 120 mw will be exploited using sugar factories as a base. This will be done through public private partnership.
  • The Energy Sector Recovery Project (ESRP), funded by the World Bank and some bilateral donors, has a major component on “Distribution Reinforcement and Upgrade” to be implemented over a period of four years. This is intended to improve quality and reliability of supply, reduce system losses and increase access to electricity service especially in the urban and peri-urban areas. This is of special interest to the industrial sector where power outages in the past led to losses.
  • The Governments of Kenya and Tanzania have obtained funding for implementation of a 330kV transmission line project between Arusha in Tanzania and Nairobi. This will be another source of extra power.

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