Can you really get cheaper power?


With the potential of wind as a better way to reduce costs of power in modern times acknowledged, experts say there are important things Kenyans need to know. According to the Lake Turkana Wind Power’s (LTWP) director Rizwan Fazal, the current negative narrative around the cost of energy will only change once all their 365 turbines start to supply power to the grid. By October 9, Mr Fazal points out, there were 225 wind turbines, and the company generated 147 MW thanks to 187 turbines running by end of October.

While at a media briefing on the progress of the project, Mr Fazal answered some of the questions that have been on the lips of both families and companies.

Electricity is the most costly service to not only companies but also individuals. When will we see 310MW being supplied to the national grid?

LTWP has 365WTGs with a capacity of 850kW each for a total installed capacity of 310MW. Depending on the speeds and the consistency of the winds, the WTG will, according to the power curve, produce from 0MW (no wind) to 850KW. The entire plant comprising 365WTGs, 365 step-up transformers 0.69/33 kV per Unit, a 33kV collecting grid, a sectionalized 33kV substation, step up block transformers 33/220(400) /30kV including the Dynamic Reactive Power Compensation Systems and all miscellaneous equipment, infrastructure and control and a SCADA System are in place and fully installed.

As at October 3, 2018, 93 WTGs are “hot” commissioned; powered by the energised T-Line, and every day between 12 -24 WTGs will be added. By end-October, all 365WTGs should be supplying power to the grid.

When will Kenyans start seeing the benefits of this project?

Depending on how KPLC dispatches the power… With the successful completion of the T-Line, grid stability in the entire Kenyan grid should improve. This ought to result in better quality of power (i.e. stable voltages, lower power trips etc), which positively impacts productivity of businesses.

The successful completion of this project will showcase Kenya as a safe and reliable investment destination – LTWP was the largest private sector investment in Kenya’s history with one of the most complex project finance structures undertaken in this region. Kenya is now ready for large-scale private sector infrastructure investment. The LTWP project also showcases Kenya’s strong ability to implement successful public-private partnerships.

Is it true that the World Bank (WB) pulled out of this project because they believe it would cost Kenyans more in the long run?

There were three main concerns: (i) can wind power be safely integrated into an inherently weak grid; (ii) will the T-Line be built on time; and (iii) will there be sufficient demand for LTWP’s wind power. LTWP addressed together with KPLC the issues of the grid integration and many technical interventions and investments (Nairobi ring and associated infrastructure, the LTWP STATCOMs in Loiyangalani and introduction of more geothermal (to provide spinning reserve) have since been implemented. The T-Line risk is not one that LTWP could control.

As far as demand is concerned, Kenya has less than 25% overall electricity penetration and with peak demand hovering at 1800-1900MW, the country must grow its power supply with renewable, affordable and reliable power. It has taken LTWP 10 years to come online and strategic planning is not to wait for demand and then build power plants – that strategy already failed and resulted in expensive power being brought in to plug the deficit. The world over, development is spurred by power supply being available and demand growing around it. This is a subjective discussion and LTWP and the WB agreed to disagree. LTWP and the GOK agreed that reliable, green, affordable power was in the long-term interests of Kenyans.

What are the comparable costs of wind power?

LTWP is Kenya’s cheapest power after hydro. For the first six year, LTWP will sell the energy at EURO Cents 8.529 per kWh and after that time, at EURO Cents 7.684 per kWh.

Experts say LTWP can only achieve about 50% of its installed capacity when generating at peak? What are your comments?

The capacity factor of LTWP has averaged over 67% in recorded wind measurements over the last 5-6 years. On October 16th, LTWP had 225 WTGs hot commissioned and we generated 147MW with 187 WTGs running. With each of the 187 WTG having a max yield of 850kW, we had a 93.9% capacity factor – possibly the windiest wind farm on the planet!

LTWP has not contracted under the PPA to always provide 310MW – that is simply impossible given that you are dependent on wind. We aim to average 65-67% over the operating year and that is outstanding by any accord.

LTWP and KPLC (through the National Control Centre) work closely on forecasting and dispatch to optimise LTWP’s output.

Is there potential to expand the farm so more power is being generated? Why did you stop at 365 turbines?

We undertook studies to determine what level of wind power could be absorbed safely by the wind farm and at that time, a max capacity of 310MW (allowing for capacity factors of between 50-70%) was deemed prudent. As Kenya’s demand rises and there is sufficient spinning reserve to balance intermittency occasioned by wind power, and subject to GOK / KPLC requirements, LTWP may explore expansion although there is nothing in the plans at this stage. Our commitment is to first deliver cheap, renewable power that has been long awaited to the Kenyans!

How long will the wind farm generate power for Kenya? What happens at the end of this project? Will the turbines be removed from the land?

LTWP has a 20 Year PPA with KPLC. The technology will likely become obsolete after that (if not earlier) and LTWP may need to either replace or enter into negotiations with KPLC to extend the PPA.

How are you storing the power when there is surplus?

Wind power cannot be stored so it must be used when generated. LTWP will provide KPLC forecasts and KPLC will have to plan the energy mix in the system and either dispatch or the wind-farm is curtailed (i.e. no power generated).

What happens when the wind drops?

LTWP provides forecasting to KPLC and when the wind drops, KPLC’s National Control Centre (NCC) must balance the load with “spinning reserve” which is power from sources that are instantly available. This is standard dispatch protocol and best practise uses hydro / geothermal as spinning reserve.

Is there possibility of exporting the energy you generate?

LTWP exports only into the national grid however, KPLC can (and ideally should) export the cheap wind power to Uganda at night so that Uganda can use Lake Victoria as a pump storage. As Kenya gets connected to the various power pools (via Namanga and Lessos), it will be able to export power and earn revenues rather than curtail power and pay for unused power under LTWP’s take-or-pay regime. LTWP offers KPLC and Kenya an incredible opportunity to become a regional power trader / supplier.

Do you have any plans to tap similar sources of energy in other parts of the country?

At the moment, LTWP is focused on ensuring that we meet all our obligations to deliver the power from our plant. Wind Power plants have a long gestation period and Kenya will have to undertake studies to determine what its demand / supply will be in the years ahead along with the planned plants in the LCPD Plan 2017. LTWP started planning in 2008 and came on-line in 2018 so it does take time!

How much land is being utilised by Lake Turkana Wind Power Ltd?

The land used for the project is leased by LTWP from Marsabit County for a term of 33 years with an option to extend twice up to 99 years. The entire concession area is 150,000 acres, representing less than 1% of Marsabit County. However, the actual project site required for the wind power project is 40,000 acres. 

Only 0.2% of the site is occupied by physical structures. LTWP’s permanent structures include 365 wind turbines, a substation and workers’ accommodation.

The remaining land, representing 99.8% of the project site, is open to the public and continues to be used by the local nomadic population for settlement, grazing of livestock, and access to water points. Moreover, the C-77 public road passes through the project site, from the southern end to the northwest end.

The project site is not fenced. However, there are two fenced areas, which are (i) the substation, for health and safety purposes; and; (ii) the workers’ accommodation, for security reasons.

What happens once 20 years of operations have been completed?

At this time, it is undetermined what will happen in 20 years’ time. There are various options, e.g.:

Upgrade of existing wind farm by LTWP (under a new contract with national and county governments, as well as KPLC); wind farm is fully removed (technical term: fully ‘demobilized’); and sold to a willing buyer.

Who owns LTWP?

Aldwych Turkana Limited (owned by Anergi, an African power company established through the joint venture between Africa Finance Corporation and Harith General Partners of South Africa); KP&P Africa B.V. The Danish Climate Fund through Investment Fund for Developing Countries (IFU); KLP Norfund Investments AS of Denmark; Vestas Finnfund – the Finnish Fund for Industrial Cooperation Ltd; and Sandpiper