The Energy Petroleum and Regulatory Authority (EPRA) has revealed that Kenya has started the importation of electricity from Ethiopia receiving 75 megawatts from the Wolayta-Sodo substation.
EPRA Director General Daniel Kiptoo said that the country is still in the process of commissioning the trade.
Director Kiptoo disclosed this in an interview with the Press in Kenya.
He further explained that Kenya has signed a 25-year deal with the Horn of Africa nation to start importing electricity in a bid to edge out the expensive power from the national grid and also ensure the country meets peak demand.
“High tariffs charged by independent power producers have squeezed Kenya Power’s ability to lower the cost of electricity.”
“We began power trade with Ethiopia yesterday. After the commissioning, our initial imports will be 150 megawatts then will upscale to 300 megawatts in the next three years,” said Kiptoo.
The DG noted that the cost of importing electricity from Ethiopia is competitive and lower than the country’s average generation cost.
Kenya Power buys the bulk of electricity from Kenya Electricity Generating Company (KenGen) at Sh5.3 per kilowatt-hour but other IPPs have priced their power as high as Sh195 for the same unit.
KenGen accounts for 70 per cent of the electricity supplied to Kenya Power with the 21 IPPs supplying the balance. The electricity imports could mean lower costs of electricity in the long run.
Kiptoo also revealed that Kenya could soon start exporting electricity to Ethiopia once it grows its geothermal capacity.
“The line between Wolayta Sodo and Suswa is a two-way line therefore we are hoping that once we develop our geothermal capacity, we will be able to also sell power to Ethiopia,” he said.
According to the energy regulator, Kenya currently has a geothermal capacity of 863 megawatts.
The USD500 million line to Kenya has the capacity to transmit 2,000 megawatts of electricity, potentially earning Ethiopia as much as USD100 million annually.
The Grand Ethiopian Renaissance Dam, a giant hydro-power dam on a Nile River tributary, began generating electricity earlier this year, a project Ethiopia sees as key to economic development.
The USD5 billion dam will be able to generate 5,150 megawatts of electricity once completed in 2024 and Ethiopia has signed supply agreements with Kenya, Sudan, Djibouti, Somaliland, Tanzania and South Sudan.