Wednesday, 19 December 2018

Demand for Diesel Power Generation wanes in Kenya


Wind, Solar, Geothermal, and Hydro 
the leading  sources of power
Green energy sources of Power generation in Kenya have surpassed 2.4GW thus paving the way for decommissioning of Diesel powered generation. Demand for Thermal power is declining as other cheaper sources come on stream. 
This process will begin in two years’ time, the President has announced. Kenya is also, self-sufficient in electric power generation in the short run.

The current capacity has risen to 2351 MW against a peak demand of 1802 MW, says KPLC, the electricity distributor.  Ninety percent (or 2.4 GW) of this capacity is supplied by green sources-hydro, geothermal, wind, and Solar sources. 
The spare capacity, which is a requirement in power generation, stood at 23 percent by June 31, 2018, says the power Distributor, KPLC’s in its annual report 2017/18. Since then, an additional 364 MW have been added to the grid which puts the total capacity at 2715 MW.
That there is more capacity to spare is a plus for the power generating community for it ensures that they do not operate under pressure.
And in a vindication to our earlier diagnosis on why Kenya’s electricity bills remain high, http://eaers.blogspot.com/2018/07/why-electricity-costs-will-remain-high.html, thermal power is slated for decommissioning.
We had diagnosed the cause of high electricity tariffs to PPAs signed with thermal power producers. The contracts, signed more than 10 years ago, have a clause for paying for idle capacity. New technologies in power generation have rendered this sources redundant, we reported.
The Phaseout will cover mainly the Coast and Western Kenya, announced President Uhuru Kenyatta, two weeks ago.
SGR: To be run on electricity
 The president announced that some 1060 MW of green energy has been added to the national grid in the last five years, of which 364 MW, were added in the last three months.
The bulk of these additions, analysts say, is in geothermal, Solar and wind power. In fact, the 364 MW added in the last three months were Windpower 310 MW and Solar Power 54 MW. Wind power and Solar are fastest growing electricity generators in the country followed by geothermal energy. This is mainly due to the low initial Capital outlay required to set them up.
Sources in the industry say that geothermal energy, in which Kenya is the leader in Africa, has already replaced Hydro generated power as the base load.  Kenya boasts of 700 MW of geothermal energy and will soon cross the 1 GW mark.
Already there are more than 600MW in the Pipeline to wit: 105 MW from Menengai fields, 300MW from Suswa fields and another 300MW from Ol-Karia fields, owned by KenGen, the state-owned power generation Corporation.  The firm plans to add another 160MW of geothermal energy by Mid-Next year.
 That the Coast region, which is heavily dependent on Thermal power, has received 100MWof geothermal energy as the base supply, is an indication that the days of Thermal power are numbered. The region hosts three of the high capacity Diesel powered generators in the country, these are; Rabai power (90 MW), Tsavo power (75MW), and Kipevu (90 MW).
KETRACO to build more transmission 
lines
The Thermal plants slated for decommissioning are relatively older contracts and produce small quantities of power. They, therefore, can be paid off the remaining years to close down so that power costs shrink.
 Kenya targets to generate 10GW by 2030. Whether that target is reached remains to be seen. However, going by the speed at which investment is flowing into the sector, they could reach at least 80 percent of the target in ten years’ time. 
The drivers of this growth will be Geothermal, Wind and Solar sources. Already there are 200MW of wind power and more than 600MW of geothermal energy in the pipeline. Once they all come on stream three years down the road, Kenya’s power generation capacity will cross 3GW mark.

In line with the growing capacity of electric power generation, the firm that constructs power transmission lines, KETRACO, has applied for clearance from the environmental authority to electrify the Standard Gauge Railway line from Mombasa to Nairobi and the adjoining economic zones. 
 The project proposed to last for 28 months will see the Railway line shift from diesel to electric powered engines. The project will involve the construction of 12 transmission lines and 14 substations to benefit industries along the railway line.
Meanwhile, the power distributor Kenya Power and Lighting Company has announced that it has connected close to 70 percent of Kenya’s population, and has therefore reached a saturation point. Consequently, it will go slow on network expansion. The firm had 6.7 million customers by the end of the last financial year suggesting it has reached saturation point.

It will thus build 3400 kilometres of medium voltage power lines this year, a 50 percent drop on 6674 km built in the previous year. Further,


it will build 14 new substations, 13 less than the previous year which ended in June.

Friday, 7 December 2018

A Tsunami Brewing at Kenya Pipeline Corp.


Joe Sang: Jumped ship,was arrested
 A Tsunami is brewing at Kenya Pipeline Corporation. And, it will ravage many people in a wide corruption network that thrives on milking KPC, we can report. The arrest of several senior managers is just the tip of the iceberg. More arrests are expected next week if documents in our possession are anything to go by.
 The paper documents the extent of sleaze and outright theft of public resources at KPC. That charges were approved and arrests made hardly a week after the sleuths officially began investigations suggests that the charges were already with the DPP.
The potential arrests include senior government officials, top officials at the corporation, politicians, their relatives, friends, associates, and dummy companies.  
Kenya Pipeline Company is a den of iniquity, we can report. Everything unethical takes place at the corporation with impunity- graft, theft and nepotism rule the company.  The crimes include employment and promotion of quacks.
John Ngumi: Chairman BOD:
Will he survive the purge?
 In addition to an alleged loss of 21 million litres of fuel from its stock in mysterious circumstances- which triggered the investigation, the firm is a den of corruption and plunder of public resources. The documents show how Senior officials made a total of  Shs 1.9 billion through inflated contract costs and kickbacks for awarding certain contractors jobs. The Theft includes even the Board of Directors and top Officials in the ministry of energy.
According to the document, Corruption at KPC is driven by top officials in the Ministry of energy and in the firm including the Board of Directors and senior management.  It has made billionaires of senior officials- both at the company and the Ministry of energy.
 Bribes and outright theft runs into billions of shillings every year. And because of this recklessness, the company is a disaster waiting to happen. Employees are not vetted making it a national security threat since criminal gangs and other undesirable characters are feared to have infiltrated this vital cog in the nation’s economic well-being.
The detailed document lists a litany of graft avenues and even names the suspects and lists their phone numbers.
Among the malpractices are corruption in the award of tenders, inflation of contracts in order to get kick-backs, outright theft of funds through unperformed contracts, and poor employment practices. The DCI sleuths have their work cut out of them as the document provides critical leads into the murk. There will be a Tsunami in there, we can predict- It is overdue.
The Managers mint millions through contracts awarded to their friends who in turn reward them with Plots of land in leafy parts of Nairobi, Luxury cars, foreign holidays and millions of shillings in out- of pocket cash to spend during the trip, and outright bribes of cash running into hundreds of millions per head. The money is paid directly to the officers or through a network of relatives, friends and dummy companies. Some of these networks have also mint millions of shillings in these deals.
For instance, the document says, a total of Kshs 1.1 billion was paid out as bribes to senior officials for the Line 5 contract from Mombasa to Nairobi. The payouts saved the contractor, Zakheim International, some Kshs 300 million when the design was changed and also to cover-up inflated prices. The document questions the speed at which the financial evaluation of the winning bid and award of the contract were done.
Andrew Kamau: PS will he escape
 the dragnet?
In other instances, senior Officials simply raise the price of the contract and share the difference with the contractor. A case in point is the Kisumu Oil Jetty whose price was suddenly raised from Kshs 900 million to Khs 1.7 billion at the orders of senior government officials. For this, they were paid a total of Kshs 410 million in kickbacks. The same officials also pocketed another kshs 158 million from the Sinedet-Kisumu Pipeline which was awarded to a company that was in constant contact with top managers before the tender award. In the case of the installation of Fibre Optic contract, the price was raised by Kshs 200 million of which Shs 154 million was shared between the ministry and KPC senior managers.
All ICT tenders are outright thefts says the document. It says that the alleged “upgrades are never commissioned,” despite having been paid for fully. Instead, the firm’s ICT systems have been compromised by these cosmetic updates designed to cover up the scandals.
 It also states that 60 percent of all business given to the Waka Family ends up in the pockets of senior officers at KPC.
The same team made a whopping Kshs 110 million from the purchase of a two-acre piece of land whose price was inflated to Kshs 653 million up from an internal Valuation of Ksh320 million. The officials transferred the valuation of the land to NLC instead of Ministry of Lands and, the document says, some directors of KPC were in contact with NLC valuers.
The document questions the role of some directors in the deal and why an Eldoret based advocate was contracted for the conveyance while there are hundreds in Nairobi who do the job. It also questions why the advocate, who has his own Law firm, was transacting under a different firm.

And to keep their records clean, the officials intimidate or bribe auditors to drop certain queries. The report cites a case in which the team auditing the books for financial years 2015/16-2027/17 were paid Kshs 60 million in addition to other payments in Kind to drop all audit queries. A senior Official also in the OAG was also paid to ask no questions.