This archive report was first published on 12 January 2020.
Kenya's commitment to its climate change strategy is being questioned as the government presses on with plans to develop coal energy. The National Treasury has allocated over Sh2 billion for coal exploration and mining over the next three years.
According to data from the National Treasury, the Ministry of Energy has earmarked Sh559 million for coal power development in the current financial year and is requesting another half a billion shillings each for the next two financial years and Sh852 million in 2023.
The government is also developing a coal masterplan and feasibility report, scheduled for completion in 2023, detailing how the country will develop and integrate coal into the national grid.
Meanwhile, the Geo-Exploration Directorate under the Ministry of Energy plans to construct 20 exploration wells, the first batch of 80 that will be constructed over the next three years.
At the same time, the directorate has allocated resources for environmental assessment and stakeholder engagement towards building of the controversial Lamu Coal power plant.
However, the National Environmental Tribunal last year cancelled the licence awarded to the consortium Amu Power Company to develop the Sh200 billion coal-fired plant, ruling that the National Environment Management Authority (Nema) illegally approved Amu Power’s environmental impact assessment.
“Coal is in the past, and renewable energy is the future,” said AfDB President Akinwumi Adesina last year at the UN General Assembly meeting on climate change. “For us at the African Development Bank, we’re getting out of coal.”
The African Development Bank (AfDB) has unveiled a Sh50 billion green base-load scheme that will be kicked off later this year and is set to yield Sh500 billion of investment to help African countries transition from coal and fossil fuel to renewable energy.
Despite the mounting concerns, the Kenyan government and Amu Power consortium have vowed to press on with the project that also includes Gulf Energy and China’s Investment and Power Construction Corporation.
Centum, the major investor in Amu Power, has made a Sh2.1 billion impairment provision owing to stalled projects, with CEO James Mworia expressing optimism over its realisation.
“By now these assets should have been on the exit path, not the impairment path,” he said. “Besides completing this development project we are not getting into any new development projects because what we’ve learnt is that it takes a lot longer and there are a lot of factors not in your control.”
