Lamu Coal Power Station

Lamu Coal Power Station (proposed)
Proposed location of Lamu Coal Power Station in Kenya
Country Kenya
Location Lamu
Coordinates 02°09′13″S 40°54′12″E / 2.15361°S 40.90333°E / -2.15361; 40.90333Coordinates: 02°09′13″S 40°54′12″E / 2.15361°S 40.90333°E / -2.15361; 40.90333
Status In development
Commission date 2020 (Expected)[1]
Owner(s) Amu Power Company
Thermal power station
Primary fuel Coal
Power generation
Nameplate capacity 1,050 megawatts (1,410,000 hp)

The proposed Lamu Coal Power Station is a potential 1,050 megawatts (1,410,000 hp) coal-fired thermal power station in Kenya.[2] The proposed plant would be developed on 865 acres of land and feature a 210 meter tall smoke stack, which would become East Africa's tallest structure.[3][4][5]

Kenya national government and media have been positive about the economic benefits from the coal plant activity, and the promised 1000-2000 jobs created.[3][6]

However, community advocates and some local government officials expressed concern over whether the benefits would be well distributed, whether the jobs would really materialise, and the lack of discussion over possible negative effects from the project.[4]

Location

The power station would be located on 975.4 acres (395 ha) in the Kwasasi area, about 21 kilometres (13 mi) north of the town of Lamu in Lamu County, along Kenya's Indian Ocean coast.[7] This is approximately 250 kilometres (160 mi), by air, north-east of Mombasa. The driving distance is approximately 300 kilometres (190 mi).[8]

Overview

Construction was expected to begin in September 2015 and last approximately 21 months. Once constructed, it will be the largest single power station in Kenya. The power generated will be transmitted to Nairobi, the country's capital, via a new 520 kilometres (320 mi), 400 kilovolt electricity transmission line. In the initial years, the station will utilize imported coal, mainly from South Africa, and later convert to locally sourced coal from the Mui Basin in Kitui County.[9] In September 2016, Kenyan print media indicated that construction is expected to begin in the fourth quarter of 2016 and last 42 months.[1]

Controversy

Community activists and some local officials have also raised the need for revenue sharing for the community, and what conditions would be set for the project to ensure it would benefit the host community, citing the fact that community members affected by the earlier oil infrastructure project known as Lamu Port and Lamu-Southern Sudan-Ethiopia Transport Corridor have not been compensated.[4] Community, Kenyan and international activists and one of the world's leading economists Joseph Stiglitz have raised serious concerns about the environmental and human health implications of the fossil fuel plant. The population wants cleaner, more progressive renewable energy.[10][11][12]

History

In January 2014, the Government of Kenya sourced for bids from private developers to build, own, and operate the power station. In September 2014, the development rights were awarded to a consortium of the following entities:[13]

Two of the losing bidders challenged the award in court. An arbitration tribunal, however, upheld the award in January 2015.[14][15]

Developers and financing

The power station will be built using private funds on a build-own-operate model. The developers will own and operate the plant for 25 years from commissioning. The expected construction costs for the coal plant will be about US$2 billion (KES:180 billion). Of this, approximately US$500 million will be generated internally while the balance will be borrowed.[15][16]

Amu Power Company, a special purpose vehicle formed by the developers, will develop, own and operate the station as part of the "Lamu Port and Lamu-Southern Sudan-Ethiopia Transport Corridor".[17]

In July 2016, Standard Bank of South Africa and ICBC agreed to jointly fund the $300 million that was needed to close the deal.[18]

Fund Sources for Lamu Coal Power Station
No.Name of LenderLoan Amount (US$) Percentage of Total
1 Amu Power Company[19] 0.5 billion 25.0
2 Industrial and Commercial Bank of China[17] 1.2 billion 60.0
3 Standard Bank of South Africa 0.3 billion 15.0
Total2.0 billion100.00

See also

References

  1. 1 2 Otuki, Neville (12 September 2016). "Amu Power seeks ERC nod for Sh200bn coal-fired energy plant in Lamu". Business Daily Africa. Nairobi. Retrieved 12 September 2016.
  2. ↑ Bocha, Galgalo (6 June 2016). "Lamu's booming economy pushes low income earners into slums". Business Daily Africa. Nairobi. Retrieved 6 June 2016.
  3. 1 2 Mbugua, James (11 April 2015). "Kenya: Planned Lamu Coal Plant Set to Transform County". The Star Newspaper via AllAfrica.com. Nairobi. Retrieved 28 January 2016.
  4. 1 2 3 Muthoni, Kamau (4 February 2015). "Lamu leaders set conditions to support Sh170billion coal power plant". The Standard (Kenya). Nairobi. Retrieved 28 January 2016.
  5. ↑ Kangethe, Kennedy (20 March 2014). "Kenya: Government Seeks Coal Power Plant Investors". Nairobi: 98.4 Capital FM via AllAfrica.com. Retrieved 24 January 2015.
  6. ↑ Otuki, Neville (5 February 2015). "Lamu Coal Plant Firms Pledge 1,000 New Jobs for Locals". Business Daily Africa. Nairobi. Retrieved 5 February 2015.
  7. ↑ Njoroge, Kiarie (25 July 2016). "1,400 Chinese workers to build Sh200bn Lamu coal plant". Business Daily Africa. Nairobi. Retrieved 25 July 2016.
  8. ↑ Globefeed.com) (28 January 2016). "Distance between Mombasa, Kenya and Lamu, Kenya". Globefeed.com. Retrieved 28 January 2016.
  9. ↑ Xinhua (24 January 2015). "Kenya To Kick Off Construction of 960MW Coal Plant". CoastWeek.Com Quoting Xinhua.
  10. ↑ Eunice Kilonzo, and Kalume Kazungu (12 July 2015). "Expert says coal plant bad for health". Daily Nation. Nairobi. Retrieved 28 January 2016.
  11. ↑ Heuler, Hilary (3 December 2014). "With New Kenyan Port, Lamu Fears Losing Traditions". Voice of America. Retrieved 28 January 2016.
  12. ↑ NYAN (6 August 2015). "US Multinationals Scooped Up Deals During Obama's Visit To Kenya". New York Amsterdam News (NYAN). New York City. Retrieved 28 January 2016.
  13. ↑ Centum (1 September 2014). "A Consortium Led By Kenyan Companies; Gulf Energy Limited & Centum Investment Company Limited, Emerges As The Winning Bidder of The Mega Lamu Coal 1000MW Project". Centum Investments (Centum). Retrieved 24 January 2015.
  14. ↑ Standard Reporter, and Reuters (15 January 2015). "Tribunal Backs Centum Consortium's KSh170 Billion Coal Power Plant Tender Win". The Standard (Kenya). Nairobi. Retrieved 24 January 2015.
  15. 1 2 Wasuna, Brian (14 January 2015). "Centum Wins KSh164 Billion Coal Power Plant Tender Case". Business Daily Africa. Nairobi. Retrieved 24 January 2015.
  16. ↑ Otieno, Jeff (28 March 2015). "Construction of Coal-Powered Plant To Begin In September". The EastAfrican. Nairobi. Retrieved 28 March 2015.
  17. 1 2 Otuki, Neville (8 June 2015). "Chinese Firm Signs KSh96 Billion Contract for Lamu Coal-Fired Electricity Plant". Business Daily Africa. Nairobi. Retrieved 22 June 2015.
  18. ↑ Juma, Victor (17 July 2016). "Standard Bank to finance Centum's Sh200 billion coal plant". Business Daily Africa. Nairobi. Retrieved 18 July 2016.
  19. ↑ Otieno, Jeff (28 March 2015). "Construction of Coal-Powered Plant To Begin In September". The EastAfrican. Nairobi. Retrieved 22 June 2015.
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