Kenya-Power production: Cost of power to shoot up
News - Africa news
Power production-Kenya - Falling water levels in the dams and rising
international crude oil prices are pushing up the cost of power,
setting the stage for another round of commodity price increases.
Meteorological Department officials say the country will experience
dry weather in the first six months of this year. Power producer
KenGen has also warned consumers to expect higher electricity bills as
it shifts to thermal generation, cutting down on hydro-power to
preserve water in its dams.
"We are now increasing thermal power generation to preserve water,"
KenGen managing director Eddy Njoroge said. "This is a balancing act
that we have to do to ensure we don't end up with emergencies. We have
ensured that there will no power rationing."
Consequently, he added, power costs might be slightly higher as fuel
cost is factored in. The higher price will be driven by escalating
global oil prices and the power mix the company will be putting in
terms of thermal generation.
The political turmoil in the Arab world is not helping the situation
as supply disruptions are likely to cause jitters in the market.
Kenya is heavily dependent on hydro-power, which supplies half of the
electricity in the national grid. The dams are mostly concentrated
along the Tana River Seven Forks cascade.
Rising power costs are a fresh challenge to consumers and
manufacturers, who had experienced a period of relatively low prices
due to high rainfall received last year.
"We are in discussion with the government on how to cushion
manufacturers from the increased costs of energy. The situation is
particularly bad in Western Kenya," said Kenya Association of
Manufacturers chief executive Betty Maina.
Some companies, however, said they are banking on the assurance by the
government that there would be no major shocks in the power sector.
"The government has assured us that there would be no major spikes (in
prices), shortages or power rationing," said Mr Jaswinder Bedi, the
proprietor of Bedi Investments, which is involved in textile
manufacturing.
Kenya Power and Lighting Company has also indicated that the
government has been mulling over the power situation. "The signals of
drought are there and KPLC with other stakeholders are monitoring it
to mitigate the effects," said KPLC managing director, Joseph Njoroge.
He said two power plants with a combined capacity of 140 MW will soon
be commissioned to start supplying power to the grid. Mr Njoroge of
KenGen said among the issues under consideration is postponement of
phasing out 60MW of emergency power.
"We do not want to subject consumers to too much fuel charge. We want
to be prudent in the way we utilise the available water," he said.
"The effect (power cost) is not likely to be too high. The fuel charge
may slightly rise but we do not see a situation where we shall be
switching off customers or subject them to too much fuel charge," he
said.
Among the projects being undertaken to increase power are geothermal
drilling at Menengai. Others are Olkaria that is expected to add 280MW
to the national grid.
Mr Njoroge said negotiations with investors over 56 MW geothermal
plant and 300MW wind plant are almost complete.
He said the issues of securities was the only the issue. The MD said
three thermal plants will also be established to mitigate effects of
shocks in the national grid.
Mwaniki Wahome
Daily Nation/08/02/2011
________________________________________________
You received this message as a subscriber on the list: africa@list.internationalrivers.org
To be removed from the list, please visit:
http://salsa.democracyinaction.org/o/2486/unsubscribe.jsp
No comments:
Post a Comment