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{
"id": 1511437,
"url": "https://info.mzalendo.com/api/v0.1/hansard/entries/1511437/?format=api",
"text_counter": 513,
"type": "speech",
"speaker_name": "Mwala, UDA",
"speaker_title": "Hon. Vincent Musau",
"speaker": null,
"content": "each entity operating as an independent power producer in Kenya in accordance with Section 93A of the Company Act, Cap. 486. Subsequently, all new power purchase agreements will only be entered into with a power generation entity that has fully disclosed and registered full beneficial ownership in compliance with the Act. On 22nd March 2023, pursuant to the National Assembly Standing Order 47, the Member for Laikipia, Hon. Jane Kagiri, moved a Motion for the reduction of the cost of electricity in the country. Subsequently, pursuant to Standing Order 218 (2) of the National Assembly, the House resolved that the Departmental Committee on Energy undertakes an inquiry into the operations of Kenya Power. The inquiry aimed to examine the agreements made with Independent Power Producers (IPPs), identify factors affecting electricity cost, including overreliance on IPPs as opposed to available renewable and other energy source and suggest measures to reduce these costs. The Committee was to submit a report to this honourable House within 120 days. In carrying out the inquiry, the Committee resolved to look at the entire value chain, from power generation to transmission and distribution. The committee deliberated and came up with the following terms of reference for the inquiry: 1. To establish the details of PPAs between Kenya Power and IPPs, including all current PPAs and those under consideration, if any, along with a list of all IPPs and details regarding ownership, stakeholders, directors, and their addresses. 2. To establish the terms of existing contractual obligations between KPLC, the Energy and Petroleum Regulatory Authority (EPRA), the Government of Kenya (GoK), and each of the IPPs. This includes—and is not limited to—contracted capacity, contract tenure, monthly capacity charges, and both fuel and non-fuel costs for each plant. 3. To establish the installed capacity and effective capacity over the last five years and projections for the next five years. 4. To establish the basis for variance in rates charged by KenGen, against the rates charged by IPPs to Kenya Power and the company, including details of unit charges by each independent power producer. 5. To establish the measures that each IPP is taking to reduce the cost of electricity for households, businesses, factories, and other consumers to support the Government's bottom-up economic transformation agenda. Hon. Temporary Speaker, in this regard, the Committee analysed the overall energy sector, evaluated the electricity sector, legal policy framework, electricity tariff structures, IPPs, jurisdictions, and justification review of PPAs in the country. The Committee further analysed IPPs in other jurisdictions. Specifically, we sent delegations to Ghana and South Africa to understand their models. It is important to note that our energy mix consists of 90 per cent green energy, basically what we call renewable energy. Our installed capacity is 3.7 gigawatts, which is still insufficient for the population of over 55 million Kenyans. We expect the electricity demand to grow by approximately 5.7 per cent annually between now and 2026. The pricing trends for electricity in Kenya have also seen quite some changes. Last year, the price for the consumers was Ksh31 per kilowatt/hour. With a small reduction, currently it is trading at Ksh28 shillings. The commercial and industrial prices dropped from Ksh21.5 to Ksh19.8. Although there has been a slight reduction following the moratorium imposed by this House, these prices remain relatively high, adversely impacting both domestic and industrial consumers. It is important to note that for domestic consumers, our electricity prices are 67.7 per cent higher than the world average and 114 per cent higher than the average prices in Africa."
}