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"id": 1511451,
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"type": "speech",
"speaker_name": "Narok East, UDA",
"speaker_title": "Hon. Lemanken Aramat",
"speaker": null,
"content": "The Energy Policy of 2018 urges for affordable, competitive, sustainable, and reliable supply of energy at a low cost in order to achieve county and national development. They need to apply the Energy Policy of 2018. The Committee wishes that this House immediately stops amendments to the purchase agreement for power generation, inclusive of tarriff both at FIT and the auction system before gazetting. All purchasing agreements should be subjected to the approval and ratification of the National Assembly. According to the global best practice in the energy sector, the acceptable loss is 13 per cent. However, in Kenya, the Kenya Power Company has accepted a loss of 25 per cent. To put it in simple terms, it means that for every four units the Kenya Power purchases from Independent Power Producers (IPPs), one unit is lost. For example, in 2022, Kenya Power encountered a loss of 22.43 per cent. Looking at this figures, you would assume that it is a small figure. Kenya Power went ahead to request the Energy and Petroleum Regulation Authority (EPRA) to allow it to pass 19.9 per cent of its loss to consumers. This loss went up to 14.5 per cent in the previous year. That translates to Ksh35.7 billion per year in losses for the utility. Inefficiencies have contributed hugely to the cost of power in this country. If we compare ourselves to our neighbouring countries, we pay Ksh23 per unit in Kenya whereas Uganda pays Ksh20 per unit and Tanzania pays Ksh12 per unit. Ethiopia pays better at 6 per cent. If Ethiopia is 3.7 per unit, it means that in Kenya it is seven times higher. Finally, as a Committee, we recommend that EPRA implements competitive procurement of energy projects under an auction system model that is similar to that of South Africa's Independent Power Producers procurement programme, in order to ensure that energy is procured competitively in line with the Gazette Indicative Tariff and the least cost power development plan. There needs to be selection of the least expensive IPPs that meet the detailed technical and financial evaluation requirements after the bid rounds, failure to which the auction will be deemed unresponsive. Further, the Ministry, in conjunction with EPRA, should draft and table for approval the Renewable Energy Auction Policy that outlines transmission from the Feed-in-Tariff, which will be in line with Gazette Indicative Tariff. It should also operationalise the auction system within six months. To cushion power utility firms against high exchange rates usually passed on to consumers, we recommend, as a Committee, that all the new power generating power plants be on-boarded to the grid and they should deal in Kenya Shillings instead of the US Dollar."
}