The Institute for Energy Economics and Financial Analysis (IEEFA) has released a report on why the Lamu Coal Power Plant is not viable and will instead cost Kenya's taxpayers a great deal while remaining underutilized.
The report draws its case from Kenya's Updated 2017-2037 Least Cost Power Development Plan (2017 LCPDP) prepared by the country’s Energy Regulation Commission (ERC), and the October 2016 Lahmeyer International report, Development of a Power Generation and Transmission Master Plan, Kenya, 2015-2035, that was prepared for the Ministry of Energy and Petroleum.
The report established that the development of a Coal Power Plant will undermine Kenya’s strategic position as a leader in renewable energy. It will increase electricity costs further, resulting from the payment of idle power. Consequently, the project will undermine Kenya's commitment to helping the world reduce greenhouse gases and the government’s promise to transition to 100% renewable energy by 2020.
Already, the country has hit its borrowing ceiling according to the Central Bank of Kenya (CBK); thus prudent use of the limited resources would be necessary and backing of an expensive Coal Power Plant with little Return on Investment (ROI) is not wise considering it’s the taxpayers who will shoulder this burden, as the report shows.The report is also a good opportunity for investors like the Industrial Commercial Bank of China (ICBC), Amu Power and Centum Investment to interact with the facts and consider investing in renewable energy, instead.