House Committee Pushes KenGen to Adopt LNG, Clarify Land Ownership

A parliamentary committee has urged the Kenya Electricity Generating Company to transition its coastal power generation from Heavy Fuel Oil (HFO) to Liquefied Natural Gas (LNG), citing environmental concerns and the country’s broader shift toward clean energy.

The directive came during an oversight visit by the National Assembly Committees on Public Investment, Commercial Affairs, and Energy to the Kipevu III power station in Mombasa County. The visit was part of a follow-up on audit queries raised in a report by the Office of the Auditor-General.

Push for Cleaner Energy

Committee Chairperson David Pkosing emphasized the need for KenGen to upgrade its technology and embrace LNG, especially as the current power purchase agreement (PPA) for Kipevu III approaches its expiry in 2031.

The Kipevu III plant, commissioned in 2011, has an installed capacity of 120MW and operates primarily on HFO, a cheaper but more environmentally harmful fuel. Although designed to run on both HFO and LNG, the plant has yet to adopt LNG operations.

Lawmakers warned that shutting down the facility without a viable alternative could trigger a power shortage along the coast, where the plant currently plays a critical role in ensuring electricity reliability.

Concerns Over Future Power Supply

Members of Parliament noted that the decommissioning of older plants—Kipevu I and Kipevu II—has already strained power stability in the region. Unlike Kipevu III, those plants were limited to HFO and ceased operations after their PPAs expired.

Vice-Chairperson John Ariko raised concerns about inadequate transmission infrastructure, pointing out that limited transmission lines contribute to power losses. Expanding the grid, he said, would improve efficiency and distribution.

Meanwhile, Yusuf Farah questioned why electricity costs remain high despite Kenya achieving approximately 90 percent clean energy generation.

Pricing and Policy Questions

Responding to concerns, KenGen management, led by Engineer Julius Odumbe, stated that electricity in Kenya is sold at the true cost of production, as the sector is largely unsubsidized. This, they explained, contributes to relatively high consumer prices.

Another legislator, David Kiplagat, called on the Energy and Petroleum Regulatory Authority to ensure fair balance between electricity generation and consumption across the sector.

Land Ownership Clarified

The committee also addressed a long-standing audit concern regarding land ownership. It confirmed that KenGen has now secured the title deed for the Kipevu III facility, resolving an issue flagged in the 2021/2022 Auditor-General’s report.

Call for Strategic Planning

With the 2031 PPA deadline looming, lawmakers stressed the urgency of ensuring LNG availability to allow continued operation of the plant under cleaner energy standards. They also directed KenGen to adopt international benchmarks in determining capacity payment mechanisms.

As Kenya continues to pursue a green energy agenda, the future of thermal plants like Kipevu III will depend on how quickly they can transition to cleaner fuel alternatives while maintaining grid reliability.