‘Solar, Wind Power cannot sustain grid’ - Kenya Power

Good evening. It’s Brian from The Kenyan Wall Street. 

Here are our top stories for today :

‘Solar, Wind Power cannot sustain grid’ - Kenya Power

By Brian Nzomo

Kenya has built one of Africa’s cleanest electricity systems, with renewables supplying nearly four-fifths of its power, but the success is creating a new problem as more weather-dependent generation enters the grid. Wind and solar now make up more than a fifth of the grid’s firm-capacity measure, prompting Kenya Power to warn that the cost of keeping supply stable is rising as output from these sources fluctuates with the weather. 

The utility firm says it increasingly has to keep other generators available and pay for them when wind or solar production falls, adding pressure to a power system already under scrutiny over high electricity costs. Kenya Power is pushing for more dependable generation from geothermal and hydropower, as well as battery storage, even as electricity demand is expected to rise with industrialization and urbanization. 

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With El Niño Rains Coming, the CBK is Cautious…

By Fred Obura 

Kenya’s economic outlook is heading into a familiar complication, with the weather capable of turning a promising harvest into a drag on growth with little regard for what economists put in their spreadsheets. As the country prepares for potentially heavy El Niño rains from October, the Central Bank of Kenya (CBK) has taken a deliberately cautious view of the final quarter and built the possible disruption into its 4.9% growth forecast. But there is an intriguing possibility on the other side of that calculation. If the rains prove more helpful than destructive, growth could surprise on the upside. The stakes are high because agriculture is expected to rebound from last year’s contraction, while floods, landslides and infrastructure damage could hit production and services across vulnerable parts of the country and worsen the expected recovery. 

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Also Read…

• The Central Bank of Kenya (CBK) held its benchmark interest rate at 8.75% for a fourth consecutive meeting on Tuesday, extending its longest policy pause since 2020 as inflation stayed within target.

• Last week, CBK policymakers urged CBK to hold the 8.75% policy rate, as subdued core inflation and a stable shilling offset persistent food and fuel pressures and risks from the Middle East conflict.

OPINION : How Financing Missteps, Not Ambition, Undid Kenya's Vision 2030

By Cuba Houghton

Kenya is already looking beyond 2030, with plans taking shape for what will succeed the country’s long-running development blueprint once its original horizon expires. But before Kenya decides what comes next, there is an awkward question about what happened to the vision it is preparing to replace. Vision 2030 succeeded in putting infrastructure at the centre of the national imagination, but it never solved the less glamorous problem of financing that ambition, measuring whether projects were delivering and deciding when a borrowing spree had become too expensive to sustain. The result was a development model in which the appetite for roads, railways and other flagship projects often ran ahead of the state’s ability to pay for them, and where unfinished projects, unspent allocations and mounting debt became part of the inheritance. Kenya should certainly dream bigger after 2030 but it must learn the unfashionable discipline of making sure its dreams can be paid for. 

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Heads Up

What You Should Watch

Briefs

• Capital Markets. Kenya’s first local Exchange Traded Fund is set to debut on the Nairobi Securities Exchange after receiving regulatory approval, giving investors a new route into a banking sector. 

• Elections. The Independent Electoral and Boundaries Commission (IEBC) has set campaign spending limits for electoral candidates and political parties ahead of next year’s election.

• Public Policy. Why can a brand-new Toyota Prado or Mercedes-Benz sit in a CMC Motors or CFAO Mobility showroom without Kenyan number plates, while an imported used vehicle must now be registered before it is sold? Here’s why…

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