I did this post on my wall and I guess it should interest those in KenGen and Kenya Power. Isn’t such a major breakdown material information that should be announced to shareholders by KenGen? Some people could be trading on this information unfairly.
THERE IS SOMETHING HAPENING IN THE POWER SECTOR THAT SHOULD WORRY YOU.
Something very troubling is happening in the power sector. For the last two months, Olkaria 1 Unit 4 & 5 hasn’t been producing any power. What are the reasons behind this since KenGen hasn’t said anything about it? Is this a maintenance shutdown or there is something more to it?
The contribution of geothermal power to the grid has reduced from 46% in January 2021 to 31% in January 2022. During the same period, the contribution of thermal (diesel) power to the grid has increased from 7% to 20%.
To add to the mystery, despite the rising use of thermal power EPRA has retained the fuel cost charge unchanged for the last three months. This is going to exert a heavy burden on Kenya Power and KenGen.
The Olkaria 1 Unit 4 & 5 has a capacity of 150 MW. Although this is just 5% of the installed capacity, it should be remembered that geothermal power is used for both peak load and baseload demand management. When it is not available, we have to revert to expensive thermal power.
The construction of the 83 MW Olkaria 1 Unit 6 was to end last year. KenGen keeps giving promises about its connection to the grid. We are yet to get a definitive answer from KenGen on when this will happen.
Last year, a unit of geothermal power was sold to Kenya Power at an average of KShs 7.19, while a unit of thermal was sold at KShs 32.97. These kind of cost disparities are so huge that they provide incentive for people to engage in misconduct. KenGen should come clean on why these geothermal power plants aren’t working and helping the country lower the cost of power.
By Ephraim Njenga.
UPDATED
I got contacted by KenGen over the post I did yesterday. Regarding the the 83 MW Olkaria I Unit 6 which is under construction I have been informed that the construction is now complete and tests are going on. Target date for commercial operation is June 2022.
Regarding the issue I raised about Olkaria 1 Uni t IV and V having been idle in January and February I am yet to get a clear explanation. They had insisted that all the geothermal power plants are operational. I have confronted them with evidence from EPRA and KNBS.
Whenever I do these posts about the power sector I am very careful to check and verify the facts. These are extremely serious issues with implications for every Kenyan.
EPRA publishes monthly data about the amount of power produced in Olkaria IV and Olkaria 1 Uni t IV & V power plants. This is because these plants use steam from GDC but they are owned and operated by KenGen. KenGen pays GDC for this steam and this charge is passed on to power users through the Fuel Cost Charge.
According to EPRA data published in the Kenya Gazette, the Olkaria 1 Unit IV and V produced 60,754,334 in December. In January it produced 425 units and in February it produced just 6 units.
How does a power plant move from producing 60 million units to 6 units? Normal maintenance would take not more than two weeks. But here we are talking of two months of downtime for a major power plant.
The power plant has installed capacity of 150 MW. A similar plant owned by OrPower an IPP produced 1.08 Billion units in 2020.
The production of geothermal power has declined from 465 million units in January 2021 to 310 million units in January 2022; a 33% decline. At the same time, production of thermal/diesel power has risen from 75 million units in January 2021 to 206 million units in January 2022; a 176% increase. Given how expensive thermal power is to consumers the implications are dire in view of rising fuel prices.
We must get answers for this worrying situation. The cost of everything is going up. We can’t afford higher power costs especially when there is no justification for such.
I have decided to share this data with the public because I have seen KenGen had done a post claiming that all their power plants are up and running in response to the post I did yesterday.
This is just diversion. My post was about the status of Olkaria 1 Unit IV and V as far as January and February is concerned. The plants could be operational as of March but we will only know that when EPRA gazettes the data in April.
All this is publicly available data. I wonder why they are accusing me of misleading the public.
UPDATED: 31/03/2022
Ephraim: I have just gotten the further response from KenGen as follows. This doesn’t make any sense. I will offer more details why in the comments section.
KenGen: As with any other machine, power plants have routine planned maintenance regimes and when it happens the power plant is unavailable. This is factored in during the annual planning for power generation.
At the same time, between December 2021 and January 2022, we had two major power outages experienced countrywide specifically on December 19, 2021, and January 11, 2022. An outage of such a magnitude takes out all power plants in the grid as was the case in the two incidences. In response, and to restore supply such a scenario will lead to the use of power sources that by their nature are quick to restart.
Geothermal power plants on the other hand take a longer time to restart and bring back to the grid. What we would also wish Kenyans to understand is that long after a national blackout has been resolved and power restored, the outages have far-reaching impacts on the affected individual power plants, some of which take weeks to resolve or even longer. This was the case with Olkaria I AU 4 & 5 which were affected by the system disturbances during the two national power outages.
As communicated yesterday, all our geothermal power plants are now on full load. We take this chance to thank the teams that continue to toil day and night to ensure that Kenyans enjoy a clean, reliable, stable, and affordable supply of electricity.” KenGen
Ephraim Reply
After denying that the plants were down, they now accept that indeed they were. However, the reasons given for the downtime do not make sense.
They claim that the Olkaria I AU 4 & 5 were affected by the nationwide power black out in December and January. The blackout happened on January 11th yet these plants did not produce any power in both January and February. In December the plant was fully functional.
KenGen has many geothermal plants such as Olkaria I, Olkaria IV and Olkaria V. There is also Olkaria III owned by OrPower the IPP. How come the blackout only affected one geothermal power plant yet they are all located at the same place? This does not answer why such a major plant was idle for two months.
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