By Titus Kimanthi
There is no room for a second power distributor because Kenya’s installed power capacity is still little, Kenya Power CEO Ben Chumo claims.
The Energy Bill 2015 which is now at the committee stage provides for licensing of more electricity distributors and retailers, and is likely to end Kenya Power’s monopoly if passed. Last month, Treasury CS Henry Rotich said the government will fast-track plans to open up electricity supply to private firms.
The plan, if implemented, will allow consumers to choose their preferred electricity currently only run by Kenya Power, which is 51 per cent owned by the state.
Chumo said Kenya’s installed power capacity, which has increased from 1,600 megawatts in 2013 to 2,341MW currently, is too small to warrant another distributor. He added that an additional distributor will also disadvantage electricity users, as opening up the market could increase the cost of power.
“We are really not a monopoly, this is a value chain although we own 95 per cent of the transmission systems. Ketraco is now building new ones, we are sharing that responsibility with them,” he said.
Chumo said the space can only accommodate other players after the government’s 5000MW programme is completed. “The incentive also, for an economy introducing another player, is when the existing player does not do very well,” he said. “Kenya Power is doing very well already. It will be a short while before you realise there are no more outages at all.”
He said the utility firm has had immense support in terms of investments, in recent years, to help it improve the network and infrastructure. Rural Electrification Authority, he said, also connects households to electricity with its low voltage network further disputing that Kenya Power is a monopoly.
He was speaking after signing a 20-year power purchase agreement with Kipeto Energy for a100MW wind project. The project is expected to be completed in the first quarter of 2018. The $320 million (Sh32 billion) project will also entail five per cent dividend for the local community for 20 years, estimated to be about $1million (Sh100 million) annually.
By Titus Kimanthi