Private sector producers of electricity in Kenya recently launched the Electricity Sector Association of Kenya (ESAK).
The association is made up of independent power producers (IPPs), private participants in the development of captive power plants for commercial and industrial facilities, as well as participants in the electricity transmission and distribution value chains.
George Aluru, ESAK Chairperson, said the main goal for the body was to harness the abilities of the private sector in contributing to the development of a sustainable sector.
The first order of business for ESAK he said would be to address the negative publicity around IPP participation in the power sector and outline an agenda around delays in licensing and approvals resulting in long lead times and high development costs.
“The association is seized with a myriad of challenges, chief of them being how to support economic growth by attracting investment in electricity while ensuring sustainability where the customer, utilities, and generators all benefit equally,” said Aluru.
Others challenges include a lack of stability in laws especially around taxation as well as supporting the current focus on the financial stability of Kenya Power, the sole off-taker of locally generated electricity capacity.
“ESAK supports the activities geared towards improving the wellbeing of Kenya Power and we welcome any collaboration with the government to this end. We acknowledge that there is insufficient understanding around IPP involvement and how the sector works. ESAK will continue to constructively engage stakeholders offering partnership, data-driven and accurate information on the state of the sector”, said Aluru
Victor Ogalo the deputy CEO at the Kenya Private Sector Alliance in charge of competitiveness and operations said despite the current challenges, Kenya’s energy sector is well developed with widespread private sector participation compared to other developing countries.
“The ongoing further unbundling of the sector under The Energy Act 2019 is also expected to allow for increased competition in the generation, transmission, and retail of electricity with anticipated direct consumer gains in improved efficiencies and cost reductions while attracting further private sector investments”, he added.