National Energy Policy - Final Draft - 14 Nov 2013

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9. Kenya imports all crude petroleum and petroleum products, accounting for about 25% of thenational import bill. By 2012 the value of imported petroleum products increased by 19.3% from2011. This increase was partly explained by a 45.1% decline in the value of crude petroleumimports in 2012.10. Kenya Petroleum Refineries Limited (KPRL) operates the country’s sole oil refinery atMombasa, which meets about 40% of local demand for petroleum products. Most of the KPRLproduction is transported via the pipeline system.11. The cost of energy has significant impact on economic activities particularly those that areenergy intensive such as cement, steel, pulp and paper production. In a liberalized market suchas Kenya’s, energy prices are a significant determinant of competitiveness of locallymanufactured goods relative to imports. In this regard, high energy prices impact negatively ondomestic wealth creation, balance of payments and employment creation since consumers optfor cheaper imports.1.2 ENERGY POLICY OBJECTIVES1. The overall objective of the energy policy is to ensure adequate secure, affordable, sustainableand reliable supply of energy to meet national and county development needs, while protectingand conserving the environment.2. Specifically these are to:(a) Utilize energy as a tool to accelerate economic empowerment for the National and CountyGovernments as well as urban and rural development.(b) Improve access to quality, reliable and affordable energy services.(c) Provide an environment conducive for the development and provision of energy services.(d) Prioritise and promote development of indigenous primary and secondary energy resources(e) Prioritise and promote the development of local technologies in energy development anddelivery.(f) Promote energy efficiency and conservation.(g) Ensure that prudent environmental, social, health and safety considerations are factored inenergy sector developments.(h) Ensure that a comprehensive, integrated and well informed energy sector plan is put inplace for effective development.(i) Foster international co-operation in energy trade, investments and development.(j) Promote capacity building in the sector through energy research, development, training andlocal manufacture of energy plant, equipment, appliances and materials.10 NATIONAL ENERGY POLICY FINAL DRAFT NOVEMBER 2013
(k) Promote appropriate standards, codes of practice and specifications for equipment,systems and processes in the energy sector.(l) Promote diversification of energy supply sources to ensure supply security(m) Promote healthy competition in the sector.(n) Promote cost effective and equitable pricing of energy(o) Protect producer, supplier and consumer interests.(p) Promote both local and international investments in the energy sector.(q) Ensure foreign investments in the energy sector have a minimum local equity participationof 30%.(r) Promote indigenous investments in the energy sector through incentives.(s) Promote and develop Government owned agencies in the development of energy resources(t) Promote an elaborate response strategy in energy related disaster management.(u) Generate at least 70% of electricity from renewable resources and build the necessarytransmission infrastructure.(v) Provide for the phased transfer of provision of energy services to the Counties inaccordance with Article 174 of the Constitution.(w) Foster cooperation arrangements between county governments and the relevant publicinstitutions.1.3 LEGAL AND REGULATORY FRAMEWORK1.3.1 The Constitution of Kenya, 20101. The Constitution has enhanced protection and enforcement of fundamental rights amongstother gains. It provides for a two tier structure of government, i.e. the National and the CountyGovernments. It distributes the functions and powers between the two levels as detailed inChapter Eleven and the Fourth Schedule.2. Specifically in relation to the energy sector, Part 1 of the Fourth Schedule provides that theNational Government shall be responsible for:-(a) Protection of the environment and natural resources with a view to establishing a durableand sustainable system of development including water protection, securing sufficientresidual water, hydraulic engineering and the safety of dams(b) Energy policy including electricity and gas reticulation and energy regulation; and(c) Public investment.11 1.0 – INTRODUCTION
Page 1 and 2: NOVEMBER 2013 DRAFTREPUBLIC OF KENY
Page 3 and 4: 2.4.4.1 Challenges in Coal explorat
Page 5 and 6: 4.5.5 Policies and Strategies and I
Page 7 and 8: Table 10.1 Energy Generation Potent
Page 9 and 10: FOREWORD BY THE CABINET SECRETARY F
Page 11 and 12: EXECUTIVE SUMMARY1. This policy doc
Page 13 and 14: 14. To enhance exploitation of the
Page 15 and 16: 24. The Government shall establish
Page 17: 1.0 - INTRODUCTION1.1 THE ROLE OF E
Page 21 and 22: (e) The Weights and Measures Act, C
Page 23 and 24: fund, mobilizing resources for rura
Page 25 and 26: 2.0 - FOSSIL FUELS2.1 BACKGROUND1.
Page 27 and 28: immense value through acquisition o
Page 29 and 30: and averaging at more than US$110 p
Page 31 and 32: town of Mombasa, through Nairobi to
Page 33 and 34: 3. The prices in Kenya as published
Page 35 and 36: 6. It is hoped that the discovery o
Page 37 and 38: (c) High sulphur levels have advers
Page 39 and 40: Policies and StrategiesPetroleum Ex
Page 41 and 42: Policies and StrategiesPetroleum Su
Page 43 and 44: plants has several advantages over
Page 45 and 46: Natural GasShort Term2014-2017Mediu
Page 47 and 48: 3. The introduction of clean coal t
Page 49 and 50: 6. Lack of a special purpose vehicl
Page 51 and 52: Policies and StrategiesFossil Fuels
Page 53 and 54: 4. Geothermal power plants use stea
Page 55 and 56: about 1,450MW remains unexploited.
Page 57 and 58: 8. Ownership of physical dam reserv
Page 59 and 60: (d) Competing interests between dev
Page 61 and 62: 3.4.2 Challenges1. Unsustainable us
Page 63 and 64: 4. Land will need to be set aside f
Page 65 and 66: Limited in Kilifi County generates
Page 67 and 68: high temperatures estimated at 4-6
Page 69 and 70:
Policies and StrategiesSolar Energy
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3. Inadequate wind regime data.4. L
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through co-generation and bioethano
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(d) 1 sea wave energy projects with
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3.12.3 Policies and Strategies and
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4.0 - ELECTRICITY4.1 BACKGROUND1. E
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2. It is estimated that as at 2013,
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Figure 4.2 - Evolution of the Energ
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(e) Thermal power plants have a rel
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6. Nuclear fuel can be recycled and
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Policies and StrategiesNuclear Elec
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Table 4.5 - Planned Regional Inter-
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to this worsening situation leading
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4.5.5 Policies and Strategies and I
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Policies and StrategiesRural Electr
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Policies and StrategiesElectricity
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7. The energy policy and the Energy
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6.0 - LAND, ENVIRONMENT, HEALTH AND
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6.2.3 Renewable Energy1. Generally,
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causes indoor air pollution leading
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6.5 DISASTER PREPAREDNESS AND MITIG
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from the licensee.Policies and Stra
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Policies and StrategiesEnvironment,
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6.7.4.4 Nuclear ElectricityPolicies
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of the risk levels.Policies and Str
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6 It is a further requirement under
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Policies and StrategiesAccess to En
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Kenya.Policies and StrategiesEnergy
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15. Seek financing of clean energy
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Figure 8.1 - Pass-Through Costs in
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Table 8.1 - Energy Tariffs and Cost
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Policies and StrategiesEnergy Prici
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Policies and StrategiesCross Cuttin
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3. In 2009, ERC established a commi
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9.3.3 Policies and Strategies and I
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9.7 ENERGY RESOURCES BENEFITS SHARI
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10.0 - ANNEXURESAnnex 10.1 The PSC
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Table 10.3 Nuclear electricity gene
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Table 10.4 Summary of the Energy St
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County Population Area (km 2 ) Foss
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ACRONYMS AND GLOSSARY OF TERMS1. AC
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RD&DREAREPRMSSMRsSAPPToEVATWpResear
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Reticulation means the network used
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National Energy Policy - Final Draft - 14 Nov 2013

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