PSECC Ltd propose 500MW of Wind Farms for Lapsset Corridor

Wind Farms can they deliver electricity at USD 0.05 KWh

The possibility of wind farms in the Lapsset Corridor delivering electricity at US $0.05 kWh (USD 0.05 per kilowatt-hour) depends on several factors:

• Wind Resource Availability: The most crucial factor is wind speed and consistency within the corridor. A detailed wind resource assessment is needed to determine the viability of large-scale wind power generation.
  • Studies suggest Kenya has wind power potential such as that exploited in the Nong Hills wind farm, but specific data for the Lapsset Corridor is required for a definitive answer.
• Technology Advancements: Technological advancements in wind turbine design and manufacturing can bring down the cost of electricity generation. While reaching $0.05 kWh might be challenging currently, future advancements could make it more achievable.
• Project Costs and Financing: The overall cost of the wind farm project, including turbine installation, transmission infrastructure, and maintenance, will significantly impact the final electricity price.

Here’s a breakdown of why reaching $0.05 kWh might be difficult currently:

• Global Wind Power Benchmark: The average global levelized cost of electricity (LCOE) for onshore wind farms is currently around $0.057 USD/kWh ([source: International Renewable Energy Agency (IRENA)]. While $0.05 is achievable in some regions, it’s not yet the global average.
• Kenya’s Wind Power Costs: Data suggests Kenya’s current wind power generation costs are slightly higher than the global average, around $0.07-0.08 USD/kWh ([source: World Bank report].

However, there’s still a chance wind power in the Lapsset Corridor could be a viable option:

• Future Cost Reductions: The continuing trend of cost reduction in wind power technology suggests that $0.05 kWh might be achievable in the coming years.
• Location-Specific Advantages: If the wind resource assessment reveals strong and consistent winds within the Lapsset Corridor, this could lead to a lower cost of electricity generation compared to the national average.

Recommendations:

• Wind Resource Assessment: Conducting a thorough wind resource assessment in the Lapsset Corridor is the first step. This will provide crucial data for determining the feasibility and potential cost of wind power generation.
• Monitoring Global Trends: Keeping up with advancements in wind turbine technology and global cost trends for wind power will be helpful in evaluating the economic viability over time.

By taking these steps, Kenya can make informed decisions about the potential of wind farms within the Lapsset Corridor and their contribution to achieving renewable energy goals for the project.

KEREA data

Some topography specificities (channelling and hill effects due to the presence of the Rift Valley and various mountain and highland areas) have endowed Kenya with some excellent wind regime areas. The North West of the country (Marsabit and Turkana districts) and the edges of the Rift Valley are the two large windiest areas (average wind speeds above 9m/s at 50 m height). The coast is also a place of interest though the wind resource is expected to be lower (about 5-7 m/s at 50 m height). Many other local mountain spots offer good wind conditions.

Due to the monsoon influence, some seasonal variations on wind resource are expected (low winds between May and August in Southern Kenya). It is expected that about 25% of the country is compatible with current wind technology. The main issue is the limited knowledge on the Kenya wind resource. Kenya’s wind resource is determined from wind speed data from meteorological stations.

The Department has 35 stations spread all over the country. The Ministry of Energy developed a Wind Atlas in 2008 using data from these meteorological stations. Information gathered is not adequate to give detailed resolutions due to sparse station network. To augment the information contained in the Wind Atlas, the Ministry of Energy has initiated a modern measurement campaign to investigate wind park locations: 55 wind masts and data loggers have been installed to collect site specific data.

Wind can provide power to the new Green Hydrogen plants as well as SEZ’s.

There is significant potential to use wind energy for grid connected wind farms, isolated grids (through wind-diesel hybrid systems) and off-grid community electricity and water pumping.  An average of 80-100 small wind turbines (400W) have been installed to date, often as part of a Photovoltaic (PV)-Wind hybrid system with battery storage.

Most of these wind turbines are imported although a few Kenyan companies have recently started locally manufacturing wind turbines ranging from 150W – 6kW and have installed 50 turbines to date. Wind pumps are more common than wind turbines, 2 local companies manufacture and install wind pumps. Installations are in the range of 300-350.The Feed-in Tariff (FiT) Policy provides a fixed tariff not exceeding US Cents 12.0 per Kilowatt-hour for wind generated electricity.

The tariff applies to individual wind power plants (wind farms) whose effective generation capacity is above 500kW and does not exceed 100 MW. As a result of the publication of the FiT, there has been a lot of interest among potential investors to exploit the resource. The Government has given approval to 20 applications with a combined proposed capacity of 1,008 MW and a further 300MW under negotiated terms. The proposed projects are at various stages of implementation.

The installed wind energy capacity on the grid is currently 5.45 MW comprising KenGen’s 5.1 MW farm in Ngong (six 850 kW turbines installed in August 2009) and 350 kW installed in 2011 at Marsabit. KenGen is developing a further 20MW at the same site in Ngong. Development of the 300 MW Lake Turkana Wind project is at an advanced stage.

In general, an average wind speed of around 6.5 to 7.5 meters per second (14.5 to 17 mph) is considered economically viable for onshore wind farms.

Kenya stands tall amongst African countries when it comes to wind energy production. Its claim to fame is the Lake Turkana Wind Plant (LTWP) which has a capacity of 310 MW.

The project is the largest of its kind on the continent with 365 wind turbines each of a capacity of 850k. In 2019 the LTWP was able to supply about 1.5b kWh of electricity handling up to 30% of Kenya’s off-peak demand and 17% of its peak demand. In that year the wind farm operated at a capacity factor of about 57% well above the global average of about 28% – 40%.

Prior to the LTWP, Kenya only had one wind plant located on the Ngong Hills with a capacity of 25.5 MW, but it now has a pipeline of projects under development. The next plant expected to be commissioned is the Kipeto Wind plant located in Kajiado which will have a capacity of 100MW. A further 251 MW is expected to be installed in the next 3 years through 6 other projects.

Kenya has a viable wind energy resource. According to the Energy and Petroleum Regulatory Authority (EPRA) 73% of the country experiences wind speeds of 6 m/s or higher at a hundred meters above ground level. Of this 28228 sq. km experiences wind speeds of between 7.5 – 8.5 m/s and 2825 sq. km experiences wind speeds of between 8.5 – 9.5 m/s.

The highest wind speeds according to Global Wind Atlas data can be experienced in the north of the country around the Lake Turkana area with speeds exceeding 8.0 m/s in some areas. The LTWP is located at the South Eastern end of Lake Turkana at a place known as Sarima. According to LTWP, the project is located in a valley between Mt. Kulal and Mt. Nyiro which valley has a funnelling effect, accelerating wind speeds resulting in the generation of more electricity.

The environs of Lake Turkana are not the only viable location to set up a wind farm. Other viable sites are located in Marsabit, Samburu, Laikipia, Meru, Nyeri and Nyandarua and Kajiado counties. The majority of the projects currently under development are located in Kajiado county. Proposals have even been floated to have an off shore wind farm in Malindi. The project, proposed by the Swedish firm VR Holding AB, was to have a capacity of 600 MW and would have costed approximately USD 2.4 Billion to construct. The Kenyan government was reluctant and eventually rejected the proposal for the construction of this project on the basis that there was insufficient demand to use up the proposed capacity. Should the project have been undertaken, it would have meant that Kenyan consumers would have had to pay for the excess unused capacity. The Kenyan government proposed that they set up a smaller capacity solar farm at 50MW with the possibility of increasing the capacity of the project as local consumer demand grew.

Despite this, the Kenyan government is committed to generating its power from 100% renewable sources. The President, had in 2018 committed to achieve this target by the end of 2020. In 2019 Kenya was generating 87.2% of its electricity from renewable sources. The target may not have been met in 2020 but the renewable projects in the pipeline are sufficient to enable the achievement of this noble goal. The incentive for this transition lies not only in environmental concerns, but also in reducing the cost burden to consumers. Currently expensive diesel generators are used to cover shortfall in available capacity. This has led to high electricity bills for consumers and which has been a constant source of tension between Kenya Power (Kenya’s main power supplier) and its customers.

The Lamu Port-South Sudan-Ethiopia Transport (LAPSSET) Corridor is a major infrastructure project in East Africa that aims to connect Kenya, Ethiopia, and South Sudan. It involves the development of a port in Lamu, railways, highways, pipelines, and other infrastructure.

The counties you mentioned — Marsabit, Samburu, Laikipia, Meru, Nyeri, Nyandarua, and Kajiado — are all located within or near the proposed LAPSSET Corridor. This means that various infrastructure projects related to LAPSSET, such as roads, railways, and possibly even special economic zones, are planned to pass through or be located within these counties.

Wind energy is a viable way to help Kenya achieve this 100% renewable energy target also due to the fact that the feed-in-tariff (FiT) for wind generated electricity is lower than that of solar. According to the Feed-in-Tariff Policy developed by the Ministry of Energy and Petroleum (MOEP), the FiT value for wind electricity is 0.11 USD per kWh. The FiT values for solar are 0.12 USD for grid connected projects. Kenya Power is however negotiating for lower rates than those set out in the FiT policy. For the LTWP PPA, the tariff is 0.10 USD per kWh for the first 6 years and USD 0.08 per kWh for next 14 years.

The FiT policy will in time be phased out for wind and solar projects as the government policy is to use an auction system for intermittent capacity plants. The auction system it is believed will help drive down the tariff costs and shield Kenyan consumers from high costs of electricity, a high priority for the Kenyan government.
For those interested in generation of wind electricity in Kenya, another key consideration is the demand for electricity. Kenya’s peak demand sits around 1900 MW but had been lower at around 1,765 MW in the early days of the pandemic given various lockdown measures. Kenya’s installed capacity is about 2,712 MW. As Kenya develops and increases its electricity demand, there will be plenty of opportunities for Independent Power Producers (IPPs). Opportunities also exist for those IPP’s who can help with phasing out and replacement of expensive and inefficient generation sources.

Nonetheless, the Kenya government has pro-investor policies which have been baked into the recent Energy Act, 2019. In order to facilitate investment in renewable energy the Cabinet Secretary in the Ministry of Energy and Petroleum is required under s. 74 of the Energy Act to prepare a renewable energy resources inventory and resource map which it is required to keep regularly updated. This is intended to reduce the costs of early feasibility studies into project viability.

The EPRA has published on its website a wind speed map prepared from the numerous studies that have been undertaken on Kenya’s wind resources. Resource maps will be available to view and download on their website.

 Source: EPRA; last accessed 22nd January 2021

EPRA and MOEP make commendable efforts to engage with renewable sector stakeholders and including IPPs and investors by availing information, by easing regulatory procedures and through constant engagement on improvements that can be made to the law and regulations. Other energy sector entities and players such as the Rural Electrification and Renewable Energy Corporation also play a big role in the promotion of renewable energy use in the country.

For IPPs interested in wind generation, early and continued engagement with the EPRA and MOEP will help with the assessment of the viability of proposed projects.  Energy is a key enabler of Kenya’s development goals and there is no more viable time as now to engage with the authorities on what opportunities there might be as Kenya looks towards its 2021 post COVID recovery and beyond.