The Turkana Wind Power substation project in Laisamis, Marsabit, in January. PHOTO | SALATON NJAU
Investments in the power sector are key as Kenya aims to achieve her Vision 2030 development goals.
But while we aver that such investments are most welcome, the Ministry of Energy should come out in the open and explain the onerous Lake Turkana Wind Power deal.
The deal obligates Kenyans to pay Sh4.6 billion though there is no mention of any possible refund to consumers if the contract obligations are fulfilled.
Electricity consumers will pay the money to a special fund that was created to cushion Lake Turkana Wind Power from losses.
The money will be collected from consumers in form of higher power bills and be put in a yet to be created security support facility account that the Treasury has jointly created with the Energy Regulatory Commission.
It is said that the Treasury declined to offer the project a government-backed letter of support that cushions investors from unforeseen political and economic risks.
Such guarantees are booked as national debt and have the effect of pushing up the country’s debt stock, which currently stands at Sh3.8 trillion or half the gross domestic product.
According to the energy regulator, the contingency facility will take care of risks associated with Kenya Power’s payment obligations to the Lake Turkana Wind Power investors.
The questions that are on many Kenyan minds is how many other such deals have been signed without extensive consultation with the public?
What, on the flipside, are the obligations that have been put on the investors to afford them such protection?
It is imperative that Parliament as the representative of Kenyans should also have a say on such deals, which not only raise the national debt, but also affect the cost of living.
It is not fair to burden consumers with more levies given that they are already struggling with other charges.
We also urge policy makers to stop the current trend where Kenyan consumers are always seen as the easier option when it comes to raising money.
Source: Business Daily