National Energy Policy - Final Draft - 14 Nov 2013

5.0 – ENERGY EFFICIENCY AND CONSERVATION5.1 BACKGROUND1. Energy efficiency and conservation refers to measures aimed at reducing energy consumptionwithout sacrificing productivity or increasing costs. Energy efficiency and conservationmeasures have the potential to scale down capital investments needed to provide additionalsupplies and reduce overall resource use. It also has the potential of reducing cost ofproduction at the end user level.2. Energy efficiency and conservation reduces energy demand, improves energy security,improves competitiveness and helps to mitigate climate change by lowering GHG emissions.3. A number of factors have highlighted the importance of, and urgency for, energy efficiency andconservation:(a) High energy prices – the continuing increase in the price of energy has significantlycontributed to increased interest in energy efficiency and conservation.(b) Insecurity of supply – expressed in the growing discomfort about the vulnerability anduncertainty of future energy supplies as well as the volatility of their prices.(c) Adverse environmental and health impacts – there is increasing concern about spirallingdegradation of the environment as exemplified by increased local air pollution and acidprecipitation from ever growing fossil fuel combustion. Associated with this are globalissues such as climate change as a result of GHG emissions.(d) Depletion of energy resources – there is growing unease at the rate of depletion of majorenergy resources. The most used energy resources such as fuel wood and fossil fuels arebecoming scarce as demand rises.4. From the consumer’s point of view, energy efficiency and conservation measures yield directsavings on the energy bill. From the national stand point, adoption of such measures wouldsignificantly reduce the foreign exchange costs of oil imports. It would also serve to deferadditional investment in power generation capacity. Ultimately, improved energy efficiencywould boost the competitiveness of Kenyan products owing to reduced input costs.5. A survey of Kenyan industries revealed that wastage of primary energy input ranged from 10%to 30%. This was attributed to a lack of information, motivation and know-how. Financialrestrictions were among the other factors that contributed to that outcome. At the end of theinitial phase of the Global Environmental Fund-Kenya Association of Manufacturers (GEF-KAM)Industrial Energy Efficiency Project, cumulative energy savings to the tune of 1,800 GWh hadbeen attained.6. It is expected that with continued efforts through the CEEC and the private sector, it is possibleto avoid emissions of CO2 to the tune of 5.2 million tonnes by the year 2015. This correspondsto energy savings of about 16,130 GWh.92 NATIONAL ENERGY POLICY FINAL DRAFT NOVEMBER 2013