Dublin, Oct. 11, 2019 (GLOBE NEWSWIRE) -- The "Kenya Power Report 2019/20" report has been added to ResearchAndMarkets.com's offering.
The Kenya Power Report 2019/20 examines the effects of the new Energy Act, signed in to law by President Kenyatta in March 2019, and outlines the market's attractions and downsides for power developers, financiers and other stakeholders.
Key features of the Kenya power report include:
- Political and economic risk analysis, including a risk management report
- Policy and regulation outlook - including an assessment of the Energy Act 2019 and the market's structure and operation
- Exclusive power sector data: 15-year (2010-24) trends on installed capacity, broken down by fuel, technology, provinces and more
- Up-to-date information on electricity supply and demand
- Profiles of major projects and selected generation sub-sector developers and financiers
- Overview of transmission infrastructure and planned developments
- Analysis of resource availability including geothermal, solar and wind as well as expected developments in Kenya's hydrocarbons industry
- Overview of Kenya's rapidly growing off-grid market
- Major macroeconomic and business trends that impact on projects
The report provides instant market intelligence to those seeking new opportunities or for those looking to refresh their knowledge of Africa's ever-developing markets.
The report presents executives, financiers, investors, policy-makers and other stakeholders with a concise but authoritative document that provides an overview of the country's politics, risk profile and the major macroeconomic and business trends that impact on projects. It also profiles key players in the sector, market structure, fuel supply, tariff information, the competitive landscape, procurement initiatives, and T&D infrastructure.
The report is illustrated through maps and graphs, with exclusive power sector data.
Reasons to Buy
- Understand the competitive landscape
- Identify key players and potential partners
- Support for strategic planning through a risk assessment of political risks, democratic accountability, stability and violence, governance, investment risk
- Understand the wider economic environment for power projects
- At a glance Overview of power projects operating, planned and under construction
- Power generation forecasts based on actual project development pipeline
Data tables are based on generation project pipeline data. The pipeline (2019-2024) displays installed on-grid capacity at years-end, and only includes those generation projects which are in development and are considered to have a realistic prospect of reaching commercial operations within the announced time-frames.
Executive Summary
Kenya is seen as a relatively attractive market for investors, with a functioning democratic polity, a stable economy, and a strong track record of private sector investment. However, the country is not without its challenges. Kenya Power Report 2019/20 outlines the market's attractions and downsides for power developers, financiers and other stakeholders.
Political and business risk
- Kenya's political situation has in many ways improved dramatically since the botched 2017 presidential election, in which tensions threatened to reach levels not seen since the violent fallout of the 2007 poll.
- In early 2018, efforts by President Uhuru Kenyatta and his fierce critic and electoral rival, opposition leader Raila Odinga (universally known as Raila'), to de-escalate tensions resulted in the highly-publicised handshake agreement' truce. The move has bridged political divides, reduced instability and afforded some breathing space to Kenyatta's governing Jubilee Party, allowing it to focus on delivering key policies.
- The agreement has not been without controversy and deep cracks have emerged on both sides of the political divide. The reconciliation has threatened to split Raila's National Super Alliance (Nasa) coalition, with the three-time presidential election candidate losing significant swathes of support among his former allies. Meanwhile, supporters of Deputy President William Ruto - a controversial figure who has for many years been considered heir-apparent to the outgoing president - are also voicing their dismay.
- Kenyatta is not expected to run in the next election, due 2022, having served his two-term limit. The polls will have a painfully long run-up - indeed, the elections are already weighing heavy on the political landscape. Speculation that Raila will again seek the Nasa candidacy - despite his assurances to the contrary - has angered many in the opposition.
- Factionalism within the ruling Jubilee Party has intensified in 2019 as the rift between Kenyatta and Ruto widens. These divisions have been exacerbated by speculation that the president may back Raila, not Ruto, in the 2022 poll. The conditions for a hotly contested and unpredictable 2022 race are thus already emerging, with the threat of increased volatility.
- Despite the political fallout and divisions within the government, Kenyatta continues to pursue his overarching economic strategy, known as the Big Four Agenda'. The ambitious plan, on which Kenyatta is pinning his legacy, aims to provide universal healthcare and affordable housing, increase manufacturing and improve food security. However, tangible results have thus far been limited, with time running out to deliver on these highly ambitious objectives.
- Delivering on these promises will be made more difficult as large-scale borrowing from China to fund major infrastructure projects have raised concerns that Kenya may fall into a new debt trap'. As the same time, government indecision and poorly conceived policies have limited the appetite of private investors for large-scale infrastructure projects.
- The Kenyatta administration has said that battling corruption is one of its top priorities, which has for decades dented public trust and deterred investors. While efforts have been stepped up and a number of high-profile investigations have taken place, graft is still a major problem to overcome, from top to bottom in the political system.
- The economy has been a positive for the government in recent years. The annual GDP growth of around 6% in 2018 is expected to continue for the foreseeable future. A free-spending government has been happy to accelerate debt-to-GDP ratios to finance major projects, even though rising concerns over Kenya's debt sustainability have caught the attention of the International Monetary Fund (IMF) and other financial institutions. Credit rating agency Moody's Investors Service reacted negatively to what it sees as over-borrowing and issued a rating downgrade to B2 in February 2018.
The electricity supply industry
The Kenyan Electricity Supply Industry (ESI) has gone through several reform programmes, particularly during the 1990s and early 2000s. Reforms have led to a relatively stable and attractive power market for foreign investors. Issues remain, but the government continues to be relatively proactive in improving the sector, despite a slow policy-making process.
- Installed on-grid capacity stands at 2,545MW as of July 2019, which is in excess of the 2018 demand figure of 1,802MW. However, network losses of over 20%, reserve margin requirements, frequent droughts and variable renewable power mean supply is not considered adequate to cover demand.
- There is strong private participation: independent power producers (IPPs) account for 991MW of on-grid capacity.
- According to the project pipeline compiled, substantial capacity additions are due online in the short term to meet expected domestic demand growth.
- The EAPP's connection with the Southern African Power Pool (SAPP) through the under-construction Zambia-Tanzania-Kenya (ZTK) interconnection could prove a gamechanger.
- Distribution utility Kenya Power and Lighting Company (KPLC) has a credible payments record. But a big concern is the Kinangop wind project's failed attempt to call in a sovereign Letter of Support', causing the government to consider watering down its IPP guarantee and investors to fret.
- Even with the introduction of regulated and cost-reflective tariffs, the financial outlook for KPLC and state generation company KenGen is mixed; both had to restructure their short-term debts with assistance from the World Bank Group. (WBG)
- Emphasis has been placed on least-cost generation expansion. Geothermal generation - already a key component of Kenya's energy mix - is identified as a key resource for medium- to long-term capacity additions. An estimated 656MW of geothermal generation is expected to come online by 2024.
- The government has set ambitious targets for universal electricity access by 2020, but these are unlikely to be achieved. Off-grid and renewable hybrid mini-grid solutions have received considerable attention, while the private sector-backed solar home systems (SHS) market has taken off in Kenya.
- The 2019 Energy Act is leading to the creation of new regulatory bodies. It mandates Kenya Electricity Transmission Company (Ketraco) as the sole independent systems operator.
- Controversy has grown over the use of non-renewable power. The government has agreed to review the $59bn Updated Least Cost Power Development Plan 2017-2037 (LCPDP), published in June 2018, due to its recommendations regarding nuclear and coal.
- The future of the planned 1,050MW Lamu coal-fired plant has been thrown into doubt after a tribunal deemed Chinese-funded project's environmental impact assessment inadequate'. Among its several problems are its siting within a Unesco-listed World Heritage Site.
Key Topics Covered
GLOSSARY
1. EXECUTIVE SUMMARY
COUNTRY SNAPSHOT
2. POLITICS
2.1 Risk management report
2.2 Structure of government
- Political system
- Stability
- Independence of electoral and judicial institutions
2.3 Key actors
- President Uhuru Kenyatta
- Deputy President William Ruto
- Opposition leader Raila Odinga
- Energy minister Charles Keter
2.4 Overview of main political parties
- Jubilee Party
- Orange Democratic Movement
- National Super Alliance
- Political ideologies of main parties
2.5 Elections
- Electoral system
- Previous election
- Next election
2.6 Major policy initiatives
2.7 Corruption
- Transparency International rating
- Major corruption concerns
- Trends
2.8 Security risks
- Terrorism
- Ethnic/tribal conflict
- 2.9 Recent major developments
3. MACROECONOMIC OVERVIEW
3.1 Overview
3.2 GDP
- Trends/projections
- Breakdown of the economy by sector
3.3 Inflation
3.4 Current account
3.5 Balance of payments
3.6 Public debt
- Risk of debt distress
- Debt-to-GDP
- Debt service-to-government revenue
- Debt profile: major creditors
3.7 Credit ratings
3.8 Exchange rates
3.9 Key lending rates
3.10 Foreign reserves
3.11 Liquidity of local markets
3.12 WBG Ease of Doing Business
3.13 Major economic strategies
3.14 Major recent developments
4. POWER SECTOR OVERVIEW
4.1 Overview
4.2 Market structure
Future developments
4.3 Profiles of institutions
- Utilities
- KenGen 22
- Kenya Power and Lighting Company
- Geothermal Development Company
- Kenya Electricity Transmission Company
- Regulators
- Energy and Petroleum Regulatory Authority
- Rural Electrification and Renewable Energy Corporation
- Nuclear Power and Energy Agency
- Energy and Petroleum Tribunal
4.4 Market operation
4.5 Sector history
- Ownership and organisation history
- Role of IPPs
4.6 Regional electricity trade
4.7 The ESI's financial health
4.8 Main consumers of electricity
4.9 Landmark power projects
- Largest IPP
- First geothermal IPP
5. POLICY AND REGULATION
5.1 Overview
5.2 Major legislation
5.3 Sector plans and policies
- National Energy Policy 2018
- Least Cost Power Development Plan 2018
- Rural Electrification Authority Strategic Plan
5.4 Legal requirements
- Generation
- Transmission
- Distribution
- Local content
5.5 Procurement
- Bilateral PPAs
- Feed-in Tariff
- Competative auctions
- 5.6 Tariffs
- Wholesale
- Retail
- Latest tariff change
5.7 Sector programmes
- Kenya Vision 2020
- Kenya Electricity Modernisation Project
- Last Mile Connectivity Project
5.8 Major adverse incidents affecting IPPs
- Kinangop Wind arbitration
5.9 Government guarantees
6. FROM THE NEWSLETTER
- Map: Electricity Infrastructure
- Map: Oil & Gas Infrastructure
7. RESOURCE AVAILABILITY
7.1 Overview
7.2 Hydrocarbons
- Overview
- Crude oil
- Natural gas
- Liquefied natural gas
7.3 Geothermal
7.4 Solar
7.5 Wind
7.6 Hydro
- Map: Geothermal, Wind & Solar Resources
8. COMPETITIVE LANDSCAPE
8.1 Overview
8.2 Selected existing generation projects
- Lake Turkana Wind
- Gitaru Hydropower
- Olkaria III Geothermal
- Garissa Solar PV
8.3 Selected pipeline generation projects
- Lamu Coal
- Olkaria I Geothermal Unit VI
- High Grand Falls Hydro
8.4 Selected key developers
- Globeleq
- Gulf Energy
- Alten Energias Renovables
- Midland Solar Ltd
8.5 Selected key financiers
- African Development Bank
- World Bank Group
- Overseas Private Investment Corporation
- China
- Government of Finland
- Lake Turkana financiers
9. TRANSMISSION AND DISTRIBUTION
9.1 Overview
9.2 Interconnections
- Power pools
- Imports/exports
9.3 T&D losses
9.4 Planned grid improvements
- Utility project pipeline
- Grid improvement programmes
- Kenya Electricity System Improvement Project
10. OFF-GRID
10.1 Overview
10.2 Electrification & access rates
10.3 Initiatives and programmes
- Kenya National Electrification Strategy
- Kenya Off-grid Solar Access Project for
- Underserved Counties
- Kenya Electricity Modernisation Project
10.4 Solar home systems
10.5 Selected players
- CrossBoundary Energy
- M-Kopa
- Azuri East Africa
- BBOXX
10.6 Barriers to entry
11. CAPACITY AND GENERATION
11.1 Overview
11.2 Supply and demand
11.3 Data tables
- Methodology
- Installed capacity, RE vs non-RE, 2010-2024 (MW & %)
- Installed capacity by fuel type, 2010-2024 (MW)
- Installed capacity by fuel type, 2010-2024 (%)
- Installed capacity, liquid fuels breakdown, 2010-2024 (MW)
- Installed capacity, liquid fuels breakdown, 2010-2024 (%)
- Installed capacity by technology type, 2010-2024 (MW)
- Installed capacity by technology type, 2010-2024 (%)
- Installed capacity by ownership type, 2010-2024 (MW)
- Installed capacity by counties, 2010-2024 (MW & %)
- Installed capacity by fuel, Bonet, 2010-2024 (MW)
- Installed capacity by fuel, Bongoma, 2010-2024 (MW)
- Installed capacity by fuel, Embu, 2010-2024 (MW)
- Installed capacity by fuel, Garissa, 2010-2024 (MW)
- Installed capacity by fuel, Kajiado province, 2010-2024 (MW)
- Installed capacity by fuel, Kiambu, 2010-2024 (MW)
- Installed capacity by fuel, Kilifi, 2010-2024 (MW)
- Installed capacity by fuel, Kirinyaga, 2010-2024 (MW)
- Installed capacity by fuel, Kisli, 2010-2024 (MW)
- Installed capacity by fuel, Kisumu, 2010-2024 (MW)
- Installed capacity by fuel, Kitui, 2010-2024 (MW)
- Installed capacity by fuel, Kwale, 2010-2024 (MW)
- Installed capacity by fuel, Lakipia, 2010-2024 (MW)
- Installed capacity by fuel, Machakos 2010-2024 (MW)
- Installed capacity by fuel, Makueni, 2010-2024 (MW)
- Installed capacity by fuel, Marsabit, 2010-2024 (MW)
- Installed capacity by fuel, Migori, 2010-2024 (MW)
- Installed capacity by fuel, Meru, 2010-2024 (MW)
- Installed capacity by fuel, Mombasa, 2010-2024 (MW)
- Installed capacity by fuel, Muranga, 2010-2024 (MW)
- Installed capacity by fuel, Nairobi, 2010-2024 (MW)
- Installed capacity by fuel, Nakuru, 2010-2024 (MW)
- Installed capacity by fuel, Nandi, 2010-2024 (MW)
- Installed capacity by fuel, Nyeri, 2010-2024 (MW)
- Installed capacity by fuel, Uasin Gishu, 2010-2024 (MW)
- Installed capacity by fuel, West Pokot 2010-2024 (MW)
11.4 Project listing
- Operating
- Construction
- Planned
Companies Mentioned
- African Development Bank
- Alten Energias Renovables
- Azuri East Africa
- BBOXX
- CrossBoundary Energy
- Energy and Petroleum Regulatory Authority
- Geothermal Development Company
- Globeleq
- Gulf Energy
- KenGen
- Kenya Electricity Transmission Company
- Kenya Power and Lighting Company
- M-Kopa
- Midland Solar Ltd.
- Overseas Private Investment Corporation
- World Bank Group
For more information about this report visit https://www.researchandmarkets.com/r/63f0kq
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