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DAM-L Kenya energy and water crisis/LS (fwd)



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Date: Fri, 28 Jul 2000 11:38:27 -0800
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From: lori@irn.org (Lori Pottinger)
Subject: Kenya energy and water crisis/LS
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Kenya

 IRIN Focus On The Energy Crisis

 UN Integrated Regional Information Network (IRIN)
 July 27, 2000

 Nairobi - As the Kenyan authorities on Thursday awaited a decision by the
International
 Monetary Fund (IMF) on the resumption of funding, the entire country
experienced an
 unprecedented power blackout last Saturday. Energy officials said it was
caused by major
 breakdowns in generating and transmission facilities both in Uganda and
the Kenyan port city of Mombasa.

 It was the most severe cut since power rationing was intensified in June,
with critics saying it exposed how much Kenya relied on Uganda for energy.
Apart from causing distress to both domestic and industrial consumers,
major facilities throughout the country were plunged into complete
darkness, raising fears that numerous patients in public hospitals were at
risk.

 "This was just a small indication of what is in store for Kenyans if this
mess is not sorted
 out," an angry economist and city resident told IRIN. "We never learn from
our mistakes."

 The Kenyan government is adamant that the situation is due to a severe
two- year drought
 which has gravely affected water levels in the country's reservoirs.
Regional analysts, for
 their part, say it is a "classic case of lack of proper management and
foresightedness on the
 part of the government".

 Several donor countries have shown signs of sympathy towards Kenya's
plight and have
 responded positively especially with donations to the famine relief kitty,
but for the energy
 sector, the message seems to be clear that the current situation could
have been prevented
 or eased.

 The Kenya Power and Lighting Company (KPLC) on Wednesday said it had
nothing to do with the current crisis. "We are just distributors and not
suppliers of power," the
 organisation's spokesman told IRIN.

 On Friday, World Bank Country Director Harold Wackman, in a statement said
the crisis
 was more a result of "long delays in the implementation of the planned
projects than the
 failure of the long rains or the suspension of World Bank funding". The
government has on various occasions also blamed an aid freeze by the Bank
as being partly to blame for the
 current problem.

 But, Wackman said, "negotiations between private investors, KPLC and the
government for these projects dragged on for long periods, despite the
obvious consequences of increased power shortages as a result of delays."
The Bank withheld financial support to the sector in the early 1990s, after
raising concerns about Kenya's poor economic governance, reluctance to
reform the power sector and poor investment decisions. It, however, resumed
lending to the sector in 1997 and approved a credit of US $125 million for
the Energy Sector Reform and Power Development Project.

 "This was only after significant progress was achieved in the pricing of
energy, restructuring the power sector, opening up power generation to
private sector investors and reforming the legal and regulatory
environment," Wackman said.

 Seven new power plants with a total capacity of 460 megawatts were
expected to be
 commissioned between 1998 and 2000. Five of the projects were to be
completed in 1999,
 one in 2000, while the last had no specific completion date. Two of the
projects were
 completed last year, the rest had the dates revised to between 2001-2003.
Some 609 mw
 of new generating capacity should have been available by now, the Bank
noted, adding that this would have increased the total installed capacity
from 717 mw to 1,326 mw.

 "What this means is that despite the prolonged severe drought, and even
with the delayed
 implementation of the Olkaria II geothermal plant [in Kenya's Rift Valley]
being funded by the World Bank, there would have been no shortage of
electricity had the original schedules been maintained," Wackman pointed
out.

 In the meantime, the Kenyan government is negotiating an exceptional
credit of US $75
 million from the Bank to finance emergency power supply from independent power
 producers. Under this programme, it is expected that private sector power
suppliers, using
 portable diesel plants, will be commissioned to supply 105 mw of
electricity for a period of 6-12 months.

 The World Bank statement said that once negotiations were concluded, supply was
 expected in the next six to 10 weeks, most likely by early September. News
organisations
 also reported that Tanzania is considering a request to export power to
Kenya and that
 officials from both countries are scheduled to meet next month.

 According to the Bank, the situation should improve after October. "If the
short rains are
 adequate and timely, and if the long rains don't fail next year, it is
anticipated that there will be no supply deficit by April 2001," the
statement said.

 Some energy consultants have taken issue with World Bank's statement which
blames the
 government for the current crisis, and accuse the Bank of "laying down
stringent conditions".
 "There are several stages before funding for projects can actually be
effected," the 'East
 African Standard' quoted a consultant as saying. "These include pre-bid
meetings, site visits, evaluation of bids, designation of selected bids,
execution of Power Purchase Agreements (PPAs), final approval of bank
awards amongst others, all of which the World Bank is part and parcel."

 As the Kenyan government grapples with the energy problem, the dwindling
water supply is another headache for the authorities. Last month, the
Nairobi City Council announced
 stringent water rationing measures for the city. Taps ran dry long before
the announcement
 in several parts of the city, which has led to the mushrooming of illegal
sales by water
 hawkers. They sell 20 litres of water at about 25 US cents, in a city
where many people live on less than a dollar a day.

 However, there seems to be a ray of hope in the water sector with the
launch of a new initiative for Nairobi by UNEP and the United Nations
Centre for Human Settlements
 (Habitat) aimed at conserving water.

 The Chief of Infrastructure Section (Habitat), Kalyan Ray, told IRIN that
the programme will include installing water saving devices for commercial
and industrial users, encourage
 recycling and reuse of water especially in industries, ensure a cut in
water leakage, introduce proper water pricing and auditing, and work
towards curbing water pollution.

 Ray said Nairobi is one of the seven cities selected to benefit from the
'Water for African
 Cities' programme. The others are Abidjan, Dakar, Johannesburg, Lusaka,
Accra and Addis Ababa.

 This item is delivered by the UN's IRIN humanitarian information unit (e- mail:
 irin@ocha.unon.org; fax: +254 2 622129; Web:
http://www.reliefweb.int/IRIN), but may not necessarily reflect the views
of the United Nations. If you re-print, copy, archive or re-post this item,
please retain this credit and disclaimer.


::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::
      Lori Pottinger, Director, Southern Africa Program,
        and Editor, World Rivers Review
           International Rivers Network
              1847 Berkeley Way, Berkeley, California 94703, USA
                  Tel. (510) 848 1155   Fax (510) 848 1008
                        http://www.irn.org
::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::::


----- End of forwarded message from Lori Pottinger -----