Kenya—Judges halt first coal-fired power plant
World Risk Developments August 2019
The courts have halted plans to build Kenya’s first coal-fired power plant against the wishes of the government to industrialise with coal. Whichever way the country’s power generation develops, opportunities in the power sector for Australian companies look promising.
Kenyan judges recently halted the planned construction of the country’s first coal-powered plant near the tourist drawcard and UNESCO World Heritage Site of Lamu. The judges found that the environmental regulator had breached the law by failing to implement an environmental impact assessment.
There are only 12 functioning coal-fired power stations in Sub-Sahara Africa, with two-thirds of electricity in Kenya generated from renewable sources. But the Kenyan government has expressed a wish to use cheaper and more reliable coal generation to industrialise. This is despite Kenya’s extensive geothermal resources, of which only a fraction have been tapped. Geothermal is regarded as one of the ideal resources to meet generating capacity and is expected to account for 26% of demanded electricity by 2031.
There are opportunities for Australian companies to develop electricity generation projects in Kenya, whether these be coal-fired or renewable. Australia currently exports around $77 million to Kenya, but the economy is growing rapidly and demand for imports will increase. Australian firms face competition from existing trade links between Europe and Kenya, but Australia and Kenya already collaborate on matters ranging from agriculture and food security, to counter-terrorism and piracy, mining exploration and education.