KENYA: The Irony Of Surplus Power Yet Electricity Is Expensive

In November 2021, Kenya’s electricity demand hit an all time high of 2036 MW, the highest ever recorded in history from a record low 1,661MW in April 2020 at the height of the Covid 19 pandemic.

After 7 months, a new high of 2051 MW was recorded.

As per the laws of demand and supply, the price of electricity would then be high, however, there’s a slight catch.

In June, international headlines beamed that KenGen has surplus energy that it would love to give to cryptocurrency Miners.

That is something to pause and ponder..

In a country with exorbitant electricity costs, companies closing because of this and households going for months without electricity because of non – payment, why would the government want to give electricity to outsiders instead of reducing costs.

The oversupply can indeed shut down the switch off KPLC movement, but it hasn’t.

This brings up and confirms the claim that KenGen indeed is controlled by Independent Power Producers (IPP) cartels.

In March KenGen had to defend itself on the allegations of switching off parts of Olkaria Geothermal Power Station to enable IPP owners to supply electricity.

This shot up the cost of electricity.

KenGen denied the allegations but it was confirmed by a government report by Energy And Petroleum Regulatory Authority (EPRA). 

The EPRA report showed that the contribution of geothermal power to the grid has reduced from 46% in January 2021 to 31% in January 2022. During the same period, the contribution of thermal (diesel) power to the grid has increased from 7% to 20%. 

In 2021, a unit of geothermal power was sold to Kenya Power at an average of KShs 7.19, while a unit of thermal was sold at KShs 32.97.  

It is clear to see the repurcussions or going the IPP way. 

In January 2022, Olkaria Geothermal power station produced 425 units of power, but in February it produced just 6 units. 

How does a power plant move from producing 60 million units in December 2021 to 6 units?

KenGen is compromised.

Indeed, it is a slap on the face of Kenyans for the power producer to engage in this economic deception.

Whilst it seems cool to have surplus power to supply to outsiders for mining Bitcoin, it isn’t great at all to the suffering Kenyan populace to close shops, shut down factories due to high electricity costs which can easily be rectified.

Reprimand KenGen, shut down IPPs, Switch Off KPLC