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Kenya to explore suitable currency for power offtake agreements

A feasibility study will be conducted to determine if Power Purchase Agreements (PPAs) should be denominated in Kenya shilling, a mix of the Kenyan shilling and the dollar or retain the dollar.

While appearing before the National Assembly Departmental Committee on Energy, Energy Cabinet Secretary Davis Chirchir said the latest feasibility study will be focused on small plants, after a similar study on larger plants indicated having a mixed denominated Power Purchase Agreements was unviable.

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Chirchir also said the government is working on reducing power transmission losses at Kenya Power from the current 23.5pc to 14pc.

The energy CS told the committee that the ministry working on strategies to reduce the cost of power by 14pc to 15pc.

Chirchir also revealed that the impact of the 16pc VAT on fuel has minimal impact on the price of electricity as it only affects Muhoroni power plant which uses small amount of dual-purpose kerosene for its operations, however, it dispatches 0.27pc of total power consumed.

Several questions from the heated panel directed to the Director General of the Energy and Petroleum Regulatory Authority on the claim as to whether the regulatory authority conducted public participation prior to revising the cost of electricity remained unanswered as the meeting was prematurely adjourned.

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