"Over the last two months, the Senate Standing Committee on Energy has been looking into why the cost of electricity continues to be high in this country." Said the Chairperson of Energy Committee, Sen. Wahome Wamatinga.

The Chairperson stated that the inquiry has not only opened the committee's eyes to many things, it has also demystified a lot of myths that were held before. 

The Senators were speaking during Electricity Sector Stakeholder Conference held on 30th June, 2023 in TradeMark Hotel at the Village Market, Kiambu County.

The Conference brought together The Ministry of Energy and Petroleum, The National Treasury, EPRA, KPLC, KETRACO, and IPP’s producing Electricity.

"For a sustainable power sector, both IPPs and Public Generators have a role to play. Investments in renewable energy have been a game-changer in backstopping the hydros and making them more sustainable" said The Cabinet Secretary Ministry of Energy and Petroleum, Mr. Davis Chirchir.

He further said that the Energy Sector will partner with other Government entities to enhance demand stimulation, increasing the customer base, and hence lowering the per unit cost of electricity.

In a bid to increase demand, as well as encourage low carbon development, the CS noted the introduction of a tariff on e-mobility, as well as a Time-of use tariff, for those who extend their operations during times of low power demand, which occurs mostly at night.

Finally, the CS said his Ministry will contribute positively to the Government’s agenda of lowering the cost of living, creating employment for the youth, and transforming the economy by reducing the cost of electricity as energy has been identified as a crucial foundation for national transformation.

The objective of the Conference was to bring all the stakeholders together for a common purpose of of coming up with modalities of reducing the cost of electricity. This is also part of our inquiry on the high cost of electricity.

"While many people have a misconception on who Independent Power Producers are and have labelled them all sorts of names, I have come to view them as necessary and important partners in reducing the cost of electricity." Said the Chairperson, Sen. Wahome Wamatinga. 

The committee heard that during the Africa Energy Forum that was held last week, the committee got to understand that South Africa for Example, from inception to financial close takes 4 months before construction of a power plant begins. 

Kipeto Wind Power informed the Committee that it took them 10 years from inception to financial close. Independent power producers

present expressed that they had similar challenges. 

"We should benchmark with those that have done it correctly. This is the reason why as a Committee we thought that we should have this meeting. We need to talk and keep talking." Said Sen. Edwin Sifuna, who is a member of the Energy Committee. 

South Africa has an IPP office and we should come up with something similar where all agencies involved in the approval process should be seconded to that office.

 The committee's Vice Chairperson, Baringo Sen. William Kisang said that he does not understand why once a letter of support is issued by Treasury it the takes another year for the Attorney General’s office to interpret that letter and give a legal opinion. 

He further stated that he still don’t understand why Treasury takes so long to issue a letter of support to Independent Power Producers that have a valid Power Purchase Agreements.

 "As you can clearly see the foreign currency component in our bills has been rising steadily due to strengthening of the dollar. If such

projects are financed using local currency, then such issues would not appear." Said the Chairperson, Sen. Wahome Wamatinga. 

In 2022, KPLC bought 12,131 Giga Watt Hours from IPP’s and what was sold was 9,814 Giga Watt Hours. The value of lost sales was 37.1 Billion. That would raise the question what happened to 2,317 Giga Watts? 

The Senate Energy Committee of the 12th Parliament when investigating the issues of tokens which occurred between January 2018 and February 2018, recommended that KPLC should be the only entity selling electricity tokens.

An attempt to move back to the agents can impact negatively on the gains made so far. Should such a move back to agents be undertaken, it will be prudent to strategize how to seal the leakages.