NewsEast & Horn AfricaKenya: Electricity company confident planned wind farm project will go ahead

Fri,17Nov2017

Posted on Monday, 29 February 2016 09:36

Kenya: Electricity company confident planned wind farm project will go ahead

By George Obulutsa

File photo©ReutersKenya Electricity Generating Company (KenGen) is confident construction of its 80 MW wind farm will go ahead and avoid the problems of a similar Kenyan project that was cancelled last week due to a dispute over the land, the company said on Monday.

Chief Executive Officer Albert Mugo said KenGen's wind power project in eastern Kenya, expected to cost $147 million and due to be completed in December 2019, would not encounter such problems as the company was consulting widely with local authorities and residents.

In the last year, the demand for electricity grew by about 5.5 percent, and this year we expect to see higher growth

A $144 million wind power project due to be developed by Kinangop Wind Park and financed by a joint venture between Macquarie Group and Old Mutual Investment Group was cancelled due to opposition from local landowners and farmers, Kinangop Wind Park said last Tuesday.

"We are also talking to the community itself; the landowners," Mugo told reporters after an investor briefing. "We want to be very involved with the community so that once the project has started, we do not want it to be derailed by the issues similar to Kinangop."

Mugo also told investors that KenGen, which is 70 percent state owned, expects electricity sales for its fiscal year ending in June to rise to 29.5 billion Kenyan shillings ($290 million), from 25.6 billion shillings a year earlier. "In the last year, the demand for electricity grew by about 5.5 percent, and this year we expect to see higher growth," Mugo said.

The company, on Friday, posted a 121 percent rise in pretax profit for the six months ended December to 8.4 billion Kenyan shillings, boosted by a jump in revenue from the sale of electricity to 14.8 billion shillings, from 11.7 billion shillings in the six months ended December 2014.

KenGen has increased its power generation capacity in recent years by commissioning new geothermal power plants. Kenya, which depends mostly on renewable energy such as geothermal and hydro power, plans to increase it power generating capacity to about 6,700 MW by 2017, from about 2,500 MW currently.

It also aims to cut electricity bills, tackling problems regularly blamed for holding back Kenyan business.

KenGen has a commitment to produce 844 MW for the grid under the plan, and Mugo said it had already added 374 MW of this. It plans to add 720 MW of electricity to the grid between this year and 2020, most of it from geothermal sources, at a cost of just over $2 billion.

The government is also promoting the use of wind energy although it is not subsiding it. Kenya's other wind power projects include a 300 MW Lake Turkana Wind Power site in the far north of the country, which is expected to go ahead without problems. KenGen already operates a 25.5 MW wind farm near Nairobi. 



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