Billion-dollar plan to spur business growth in Kenya
Finance minister Uhuru Kenyatta (centre) Planning minister Wycliffe Oparanya (right) and assistant Finance minister Oburu Odinga (left) pose for a photo before leaving Treasury for Parliament where Mr Kenyatta presented the 2010/2011 Budget June 10, 2010. Photo/STEPHEN MUDIARI
By Mark Kapchanga (email the author)
Posted Monday, June 14 2010 at 00:00
Kenya will spend over Ksh406.5 billion ($5.42 billion) in projects that have over the past years inhibited business growth.
Kenya presents a 'job creation budget'
Latest statistics from the just concluded 2010/2011 budget presentation show that the government will spend the money for the enhancement of investment climate.
To usher in more inflows, Treasury said that it was determined to bring down production costs. Leading the pack is the radical proposal to cut power overheads incurred by firms, as Finance Minister Uhuru Kenyatta said in his budget speech that that the country will be shifting its reliance on hydropower to alternative but cheaper energy sources.
The new development will see businesses use more of geothermal, wind as well as solar power it its operations. The shift is also likely to reduce pressure on hydropower, especially with the ballooning demand for energy.
Analysts say the diversification of power sources is likely to spur company margins as energy costs have eaten deeply into their revenues. Reports show that alternative energy sources account for only 6.4 per cent of Kenya’s total energy use.
“The government is aware that there are many private investors who are keen to invest in the energy sector and especially in alternative and cheaper sources. However, there are concerns that the procedures take too long. In this regard, Treasury commits to support the Ministry of Energy by removing all procedural and licensing impediments so that private investment in the energy sector can be fast-tracked,” Mr Kenyatta said.
Currently, the Energy Regulatory Commission is formulating a system that will see the electricity tariffs reviewed to ensure predictability of power costs.
In the 2010/2011 fiscal year budget, more than Ksh34.1 billion ($455 million) will be pumped into the sector with more than Ksh15.6 billion ($208 million) invested in expansion of the national grid system and Ksh11.6 billion ($154.7 million) for geothermal development and coal exploitation.
Geothermal power generation is likely to be expanded substantially this fiscal year as public-private sector partnerships help the country exploit an additional 500MW in the next four years. This will bring installed power capacity to a total of 800MW by 2014.
In an effort to open borders to foreign businesses and increase the county’s competitiveness, the minister proposed that radical reforms be introduced especially in the regulatory institutions “whose mindset appear to be aimed at preventing not facilitating business.”
This apparently referred to local authorities that have in the recent years come under sharp criticism over their archaic regulations, which have substantially affected business operations.
Nairobi City Council is a conspicuous example for its bureaucratic, corrupt and overlapping licensing procedures.
“This budget proposes measures to improve our regulatory framework supportive of private sector-led growth. One key action in this direction will be the enactment of the proposed Business Regulation Bill which is now ready for submission,” the Finance Minister said.
Once enacted, The Bill will bar regulatory bodies from introducing punitive charges and fees at will.
Labels: ENERGY, GREEN REVOLUTION, SOLAR ENERGY, SOLAR THERMAL
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Sinazongwe to have thermal power
October 23, 2008
Ministry of Energy and Water Development Permanent Secretary (PS), Peter Mumba, has disclosed that three companies have been short listed to bid for investment in thermal power in Sinazongwe district. Mr. Mumba said this when he paid a courtesy call on Sinazongwe District Commissioner, (DC) Mungoni Simulilika today.
Mr Mumba said that the government wants to find a quick solution to power deficit the country was experiencing through investment in thermal power.
The PS, who was on tour of water projects and to establish the district which would be producing thermal power using coal, said the Ministry of Mines and the Zambia Consolidate Cooper Mine (ZCCM) Investment Holding were spearheading the project.
He said the company to be chosen after the bids would produce 540 mega watts of power to caution the deficit the country was experiencing.
Mr. Mumba said government was looking for a company that was already experienced in coal mining and producing thermal power.
And Sinzongwe DC,Mungoni Simulilika, said the setting up of a thermal power station would help to boost the economy in the district.
Mr. Simulilika noted that the department of Water Affairs was important to the development of the district which is a drought prone area.
ZANIS/ENDS/TN/EB
Labels: PETER MUMBA, SINAZONGWE, SOLAR THERMAL
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Investors bask in solar power's sun
Silicon Valley startup Ausra says it can generate cheap, reliable electricity from the sun. Fortune's Marc Gunther looks at whether solar power'sday has finally come.
By Marc Gunther, Fortune senior writer
September 13 2007: 10:36 AM EDT
(Fortune Magazine) -- By now, you've probably heard that the solar energy business is booming. Wal-Mart (Charts, Fortune 500) and Tiffany's, Microsoft (Charts, Fortune 500) and Google, Estee Lauder and Target (Charts, Fortune 500), Kohl's and Staples - all use or have announced plans to use solar photovoltaic panels on their rooftops to power their businesses.
But you may not have noticed the arrival - actually, the revival - of another solar technology, called solar thermal. Whereas solar photovoltaic panels are installed directly on buildings and convert sunlight into electricity, solar thermal power is more complicated: it uses mirrors to concentrate sunlight and heat liquids, which are then used to drive turbines to make electricity.
John O'Donnell, an executive at startup Ausra, says his company's technology is cheaper than other solar power alternatives.
Unlike solar photovoltaic, solar thermal projects tend to be large-scale and in remote areas.
Solar thermal has as much potential as solar photovoltaics and maybe more because it can be deployed on a large scale - big enough to light up shopping malls or towns, not just a home or a building.
Cleaning up coal's bad rap
Like solar photovoltaics, solar thermal has been around for a long time. The problem is, until now, it's been too expensive and the electricity generation too intermittent (think lack of sunlight) to compete with coal or nuclear power plants.
Solar thermal's day, however, may finally have arrived, thanks to improved technology, federal tax credits and state requirements that utilities buy power from renewable sources. Federal climate change legislation - which, if enacted, would drive up the cost of electricity from fossil fuels - has also tilted the playing field in favor of low-carbon power sources like solar thermal and wind power.
Today entrepreneurs are racing to cash in. Three large-scale solar thermal plants have been announced in recent months in California, the latest coming from a Silicon Valley startup called Ausra.
Ausra announced this week that it has raised more than $40 million from venture capital firms Khosla Ventures and Kleiner, Perkins, Caulfield and Byers, and said it plans to build a 175-megawatt solar thermal power plant at an undisclosed location in central California.
Read more on the Green Biz
Begun five years ago as an Australian company called Solar Heat and Power, Ausra relocated to Palo Alto last year with the backing of well-respected technology investors Khosla (a co-founder of Sun Microsystems (Charts, Fortune 500)) and Ray Lane (the former president of Oracle (Charts, Fortune 500)), both of whom sit on the company's board.
"We are disruptively lower cost than existing solar technologies," says John O'Donnell, Ausra's executive vice president, and a longtime technology industry executive.
Ausra isn't the only company that's betting big on solar thermal.
A Spanish firm called Acciona Solar Power began operating a 64-megawatt solar thermal plant in the desert south of Las Vegas in June. Pacific Gas & Electric (Charts, Fortune 500) said in July that it will contract to buy 550 megawatts of solar thermal power to be produced in the Mojave Desert by an Israeli company called Solel Solar Systems.
And BrightSource Energy, a Oakland, Calif.-based privately held company, said last week that it plans to build a 400-megawatt solar thermal plant, also in the Mojave. Earlier, Stirling Energy Systems of Phoenix, Arizona, announced plans for two solar thermal plants in partnership with utilities in southern California.
Vinod Khosla, one of Silicon Valley's most powerful venture capitalists and an Ausra investor (see "24 top innovators" ), boasted recently that the company's first solar thermal plant would be cheaper than any of the "clean coal" plants on the drawing board.
"I'll beat them any day of the week on price, and I'll build them more quickly. I'll challenge anybody with this," Khosla told the Toronto Sun.
Rupert Murdoch's climate crusade
Such braggadocio is often heard these days in Silicon Valley, where clean energy startups are as ubiquitous as dot-coms were in the late 1990s. But Ausra is a worth a look for a couple of reasons - the pedigree of its backers and the fact that it is part of a boomlet in the solar thermal business.
Ausra executives say the company's technology and manufacturing plans will reduce the capital costs of building solar thermal plans. Once its plants are running, and its borrowing costs come down, the company says it will sell electricity for much less than existing solar or wind installations.
"As soon as we can build solar power projects with the same cost of capital as building conventional coal or natural gas plants," O'Donnell says, "we'll deliver electricity at the same cost as coal."
If so, that by itself would be a significant breakthrough.
A second claim being made by Ausra is equally bold. The company says, rain or shine, its plants will be able to store heat for up to 20 hours, allowing it to sell electricity to the grid whenever demand is greatest.
These claims need to be regarded skeptically. But the fact that venture capitalists, utilities and startups are pouring significant money into solar thermal suggests that this technology isn't smoke and mirrors - to the contrary, it may be an opportunity to replace smoke with mirrors.
Labels: SOLAR ENERGY, SOLAR THERMAL
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