October 7, 2008

Kenya “Focuses” on Geothermal Energy to Reduce Power Costs

Text of report by state-owned KBC (Kenya Broadcasting Corporation) Radio on 7 October

President Mwai Kibaki has today urged the Ministry of Energy to provide the necessary technical assistance to private sector firms with the capacity to generate cost-effective electricity from waste material and other bi-products to generate their own power and surplus for sale to Kenya Power and Lighting Company.

The head of state, who was addressing stakeholders and international experts during the official opening of the national energy conference at Kenyatta International Conference Centre [KICC] in Nairobi noted that inflationary pressures exerted by the high cost of electricity in the country threaten the performance of the economy.

[Kibaki] There is no point in our mourning about these problems, they are genuine, they are real, they are with us. They live with us, we live with them, we just must find a solution; there is no other way, so let us all of us think of how to find that solution.

[Presenter] The president told the Ministry of Energy to ensure timely completion of power generation projects and implementation which have a combined capacity of 220 megawatts to replace use of diesel generators.

On exploitation of renewable energy resources in the country, President Kibaki said the government was focusing its attention on geothermal energy potential which was estimated at 4,000 and 7,000 megawatts under the Vision 2030 second term plan power that could be delivered at less than five shillings per kilowatt hourly.

The president announced government plans to form state-owned Geothermal Development Company to coordinate implementation of renewable energy source projects in the country.

The head of state also announced government plans to set up a Nation Power Transmission Company funded through annual budgetary allocations to reduce high system losses and low voltage and directed the relevant offices to expedite the registration for the plant to start operations.

The president said oil consumption rate for the last five years indicate the high economic growth rates planned under Vision 2030 may be undermined unless urgent measures were implemented to address the challenges of the energy sector.

Speaking during the same forum, Energy Minister Kiraitu Murungi, thanked President Kibaki for his unwavering support to revamping the energy sector because of its tremendous contribution towards the achievement of the Vision 2030.

[Murungi] As a government we cannot allow this unjust profiteering by oil companies and it is our duty to protect Kenyans from exploitation. I have asked the Energy Regulatory Commission to advise me on the modalities of introducing a price control mechanism based on a reasonable mark-up on the international crude oil prices among other legal mechanisms.

[Presenter] Regretting that the current high cost of electricity had led to a 40 per cent increase in manufacturing costs, the minister said that he was consulting with stakeholders with an intention to introduce price control in petroleum products to cushion consumers from exploitation by greedy dealers.

Later President Kibaki toured various exhibition stands mounted at the KICC grounds by major stakeholders in the energy sector.

The conference was attended by senior public and private sector officials among other key players in the energy industry.

Originally published by KBC Radio, Nairobi, in English 1600 7 Oct 08.

(c) 2008 BBC Monitoring Africa. Provided by ProQuest LLC. All rights Reserved.