Kenya mulls production auction for power sector

electricity generation
electricity generation

Kenya is set to start an auction system for investors interested in investing in future power generation, a government official said on Tuesday.

Benson Mwakina, director for renewable energy in the ministry of energy, said the new auction system is expected to replace the current system where investors come up with power project, signs power purchase agreement with Kenya Power and then implement the project.

“We are in the final process of setting up the mechanisms for establishing an energy auction system that will allow potential investors to bid for the development of various power projects across,” Mwakina told an energy forum in Nairobi.

He said the provision which is contained in the new Energy Act 2019 assented by the president recently is expected to completely change the landscape of the country energy sector.

Timothy Gakuo, chief economist, ministry of energy, said the new law has also unbundled the sector, providing clear role and mandate for the various players to fulfill their obligation.

There is a proper provision for integration of county energy plans into the national energy plan, providing for synergies and complementarity,” Gakuo added.

This, he said, is expected to lead to provision of clean, accessible, affordable and available energy for all domestic needs and commercial use as it is expected to address the real cost of energy through the chain of generation, transmission, distribution and retailing.

The new law has seen entities such as the former Rural Electrification Authority mandated with responsibility for renewable energy hence renamed Rural Electrification and Renewable Energy Agency (REREA); Energy Regulatory Commission becoming Energy & Petroleum Regulatory Authority (EPRA), among others.

“The provision of clean renewable energy is now formally anchored in the law and this portends new opportunities especially for the private sector players,” said George Aluru, vice chair for Kenya Private Sector Association (KEPSA) energy board. Enditem

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