The role of geothermal and coal in Kenya’s electricity sector

Kenya is one of the fastest growing economies in Sub-Saharan Africa, with high anticipated economic growth rates and ambitious flagship infrastructure projects. However, recent electricity demand forecasts were considerably decreased. Both in the scenarios of subdued growth and higher future electricity demand growth, it is key that capacity planning for electricity generation is carried out so that electricity supply matches demand. At the same time, sustainable development-related objectives and environmental targets need to be achieved. This includes Kenya’s target to reduce greenhouse gas (GHG) emissions by 30% below business as usual by 2030, as announced in the country’s Nationally Determined Contribution (NDC) to the Paris Agreement.

A major challenge for planners and policymakers in the electricity sector is identifying the optimal combination of electricity generation technologies within different load-factor categories in order to achieve the best match at the lowest cost. This study aims at supporting decision making in the electricity sector by comparing the two main power generation technologies that are considered baseload electricity supply options in Kenya, namely, geothermal and coal, and the role that they can play in Kenya’s future electricity supply mix. This role is determined by a number of factors, including technical considerations, resource availability, environmental characteristics, economics, and other issues that may act as drivers or pose barriers or risks to the development of this source. Electricity sector planning in Kenya relies on a 20-year rolling masterplan for power supply, the latest being the 2017-2037 Least Cost Power Development Plan (LCPDP), which sets a clear direction for the development of the sector and thus serves as a main reference for this study.

While Kenya has a long history of developing geothermal resources, coal has not yet been exploited. Kenya has a high geothermal resource potential of around 10,000 MW along the Kenyan Rift Valley. The current installed geothermal capacity in Kenya is 745 MW, with most of it in the Olkaria fields. However, the Government of Kenya plans to build two coal power plants over the next 30 years: one in Lamu, a 981 MW power plant divided into three units of 327 MW each, to be commissioned by 2024, and a 960 MW power plant in Kitui, which is scheduled for 2034-36. While the plant in Lamu will run on imported coal, the plant in Kitui is predicted to use domestic coal.

The development of these two generation technologies will have a considerable impact on the electricity sector in Kenya, affecting the generation costs, affordability of electricity, and overall flexibility and reliability of electricity supply.

Read more at the NewClimate Institute


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