VERD Q.I. CEO Sabine Christiaens spent 1 month in Kenya to meet with several stakeholders and develop further the renewable energy business in East Africa. It was a good chance to get an updated view on the energy sector:

​A lot has happened over the last months in the Kenyan market.

First of all 4 PPAs for a total of 160 MW have been signed! These are according to the FIT tariff of 0,12 $/kWh. 

Furthermore it is mentioned that another 5 projects of 40 MW will be signed in the future.

This news is definitely a breakthrough in the IPP solar market. When I was there last month, all kind of speculations were going on. I heard from different parties that they were renegotiating the FIT tariff to 8 or 8,5 $ cents/kWh, so I am actually quiet surprised that finally the first projects are signed at this tariff.

Although I am still wondering what exactly will happen with the other projects. I know that some of my clients are also waiting to get them signed, and it can be questioned why certain projects got signed and why others not. Unfortunately we are facing a market where corruption is still a common practice.

When you talk with the local developers, they try to convince you about how good their project is talking mainly about their excellent conditions with the government in order to make sure that the PPA will be signed. However if you ask them basic data on irradiation, you get answers like : how to you measure that ?

Definitely some work here to do :)

As always I was able to update my knowledge of the market with the different stakeholders: ERC, IPPs, investors, developers, EPC contractors, module manufacturers, debt financiers, IFC, etc. 

It was good to know that new players have come up in the market.

As a general trend I would say that developers are reluctant to develop IPP projects. They are considered to be difficult to pursue. A lot of the developers are more focusing on captive projects and you can see already different projects out there in the market.

On the other hand, the coming into force of the Energy (Solar Water Heating) Regulations 2012 after a five-year grace period now means that building with hot water requirements of a capacity exceeding 100 litres per day must install solar heating systems.

You can find more information in the following article : 

http://www.theeastafrican.co.ke/business/Kenya-solar-panel-law-takes-effect/2560-3911456-475khe/index.html

There is definitely a lot happening in the Kenyan market and we hope to keep you posted in the future!