Kenya counts on industrial parks to spur power uptake

The Lord Clive Hollick (left) UK trade envoy to Kenya & Tanzania, Nic Hailey (second left) The High Commissioner of the UK to Kenya, Eng. Patrick Njoroge (second right) PS Ministry of Energy & Petroleum and Jeremy Awori (right) CEO Barclays Bank of Kenya during a renewable energy conference on 6th October 2016. PHOTO:WILBERFORCE OKWIRI

The Government is betting on more industrial parks to increase demand for power to match ongoing huge investments.

This is in order to avert a supply glut as more investors continue to make investments towards achieving 5,000MW by next year.

The Government will continue putting up more industrial parks across the country to help spur demand for power Energy Principal Secretary Joseph Njoroge has said.

“There is a deliberate intention of putting most of these industries not too far away from the [power] generation sources so that we can be able to reduce even further the cost of electricity,” he told investors from UK during a conference in Nairobi.

In a day-long conference that brought together 100 representatives from Kenya and British firms that are keen on renewable energy investments, Njoroge said the strategic locations will create competitive prices and attract more foreign direct investment.

However, Njoroge said investments in energy will rely heavily on the demand side as opposed to just hitting the 5000MW target. The Ministry of Industrialisation is leading Government’s effort to set up industrial parks with Dongo Kundu in Mombasa, Taita Taveta, Voi, Mtito Andei, Nairobi, Naivasha and Nakuru already having been earmarked for the first phase.

Private developers have also been setting up similar facilities. Next week, a Sh7 billion Infinity Industrial Park, which sits on a 200-acre plot in Utawala, is set to be opened. In the current financial year, the Government pledged to establish green industrial parks under Special Economic Zones along the Standard Gauge Railway from Mombasa to Western Kenya.

Speaking in the same function, UK top Trade envoy to Kenya and Tanzania, Lord Clive Hollick reiterated the commitment of British firms to increasing their investments in renewable energy. “The memorandum of understanding between Kenya and UK to set aside Sh70 billion for investing in renewable energy will support the capacity and development of strategic renewable energy projects in Kenya,” he said.

Barclays Bank Kenya CEO Jeremy Awori, whose bank co-hosted the forum, said Kenya needs to increase the uptake of renewable energy to cushion itself from potential global oil price shocks that could strain the balance of payments.

“In addition to the cost, environmental impact of our dependence on traditional fuels makes it imperative that we work quickly to transition Kenya to a clean energy future,” he said. His bank has invested in several power projects including Sh13.4 billion in Thika Power Plant and Sh26 million in ‘Light up Kenya’ initiative that is targeting to connect 100,000 rural homes to solar power.

Increasing renewable energy will give Kenya momentum to compete effectively with other emerging economies, according to British High Commissioner to Kenya Nic Hailey, who praised the country for being second on the continent in using renewable energy.