You have probably heard of the Amu Power project which is slated to start construction later this year. I got to sit down with Sanjay Gandhi, who is the Chief Operating Officer at Kurrent Technology and the Engineer/Project Manager in charge of Health, Safety, and Environmental issues on the Amu Power project. I had some concerns related to the project and Sanjay was kind enough to talk to me about them.
Tell me more about the Amu Power project.
There are 7 components of the LAPSSET project in Lamu. The power project is a key component of LAPSSET and will enable the growth of the economy in a vital way; the reduction of electricity costs.
Kenya uses a combination of power sources including renewable and non renewable. 65% comes from renewable resources like water. Hydropower accounts for 50% of energy harnessed from renewable sources. However this can be problematic if the weather patterns are unfavourable (Kenya Electricity Generating Company) KenGen has a power purchase agreement with (Kenya Power and Lighting Company) KPLC where they sell power at 9 cents per kilowatt which comes to around 8 shillings per kilowatt. So production is at Ksh. 8 and it is sold for around Ksh. 18 by KPLC after levies and costs have been added.
The coal power plant will be able to sell power at 7.5 cents per kilowatt hour. Then it can be sold at around 16 shillings. If cost of distribution can be harmonized then an amended tarrif structure can be implemented as the cost of distribution will be lower.
So what’s special about Amu Power?
The proposed Amu power plant will be the largest private sector independent power producer (IPP) in Africa thus putting Lamu strategically on the map of Africa and indeed the world. As a single power plant, it will the largest one of its kind in East Africa and will produce a gross capacity of 1050MW of electricity; the power plant will produce about 40% of Kenya’s electricity demand. The power plant will produce base load requirements for the country and will be capable of being in continuous operation for almost two years before major maintenance works are required.
The proposed coal power plant will generate a gross power capacity of 1050MW and will be most cost effective and efficient type of power plant in the country. From a cost perspective, the construction cost of the project will be about US$1.9Million per MW; geothermal power plants cost about US$3Million per MW; wind power projects cost about US$3 – 3.5Million per MW. Kenya Power would buy electrical power at the rate is US$12 cents/kWh for wind power, just over US$9 cents/kWh for geothermal power and US$7.5 cents/kWh for Lamu coal power plant.
There is a concern about the environmental impact of the project.
The project will use clean coal technology which is very expensive but Amu Power wants to make sure that the project does not adversely affect the environment. The system makes sure that most of the contaminants from the coal are removed and the only thing that comes out of the chimney is water vapour.
For the ash dump there will be a high density polythene paper laid out where the ash will be dumped. This will be compacted and sprayed water and when this dries it will become cake. This can be sold to make concrete blocks, roads, and cement.
I read somewhere that you are using imported coal. Why aren’t you using coal from Kitui? So where are you sourcing the coal from?
The coal will be sourced from outside the country for now. Some of the countries being considered include South Africa, Mozambique, Indonesia, and Australia. Under the agreement Amu Power signed with the government, who will negotiate for the price of coal with the other country. Amu Power will then buy it and bring it here.
The Amu coal power plant will be designed to burn a variety of coals from different locations. It is designed to burn coal from Kitui as well as from imported sources. The coal from Kitui is currently in the exploration phase which means that it will take time to develop the resource, know the quantity available, and how to mine it.
Secondly, once the coal mine in Kitui becomes operational, the coal needs to be transported to Lamu and the cost effective option is to transport it by rail. Such a rail line will need to be developed between Kitui and Lamu; for comparison purposes, the current Standard Gauge Railway is being built at a cost of about US$8 million/km. At this rate, a new railway line from Kitui to the Amu coal power plant (300km) may cost about US$2.4 billion.
What mitigation measures will be implemented for adverse environmental and social impacts?
There are a number of environmental mitigation measures that have been incorporated in the design of the Amu coal power plant.
The Amu coal power plant will be designed based on super-critical technology. This type of technology is better than the sub-critical technology used in several coal power plants around the world as it utilizes less coal to generate the same amount of steam needed to generate power. This implies that the amount of ash content from a super-critical coal power plant is less than that generated by a sub-critical power plant.
Air pollutants of concern from coal fired power plants include sulfur oxides, nitrous oxides and particulate matter. Technologies are now available called “clean coal technologies” which are incorporated in the design of the power plant to manage stack emissions. Such technologies include Electrostatic Precipitators (ESPs), wet Flue Gas Desulfurization (FGD), low nitrous oxide burners and Selective Catalytic Reduction (SCR). These technologies are able to achieve efficiencies ranging from 90% to 99%.
ESPs will be used for removal of particulate matter from the air emissions generated from burning of the coal; this particulate matter is referred to as “fly ash”. Wet FGD will be used to treat and remove the sulfur oxides within the air emissions; low nitrous oxide burners will be used to allow complete combustion of the coal thereby reducing the nitrous oxide air emissions. The Amu coal power plant contains a provision to install at a later date, an SCR unit for each of the three generation sets to reduce the nitrous oxide emissions.
The proposed Amu power plant will incorporate the above “clean coal technologies” for air emissions management; with the implementation of these technologies, the power plant will comply with the air emissions guidelines stipulated in the World Bank Group’s latest Environment, Health and Safety (EHS) Guidelines for Thermal Power Plants dated December 19, 2008.
What about the people living on the Island?
The Government has launched a resettlement action plan and Amu Power is actively involved in it. 80% of the people who own land in that area use it for subsistence farming. The issue is getting the legitimate land owners. Amu Power does not own the land it is building on, it will lease the land from the Kenya Ports Authority.
The National Government through the Ministry of Energy and Petroleum, the National Lands Commission and the County Government of Lamu will manage land issues in liaison with the Project Affected Persons (PAPs) by undertaking a comprehensive inventory of assets such as land, structures and crops. Subsequent to this, a comprehensive compensation and resettlement through a Resettlement Action Plan (RAP) was launched in May 2015 and sensitization process is ongoing.
Subsequently, the Resettlement Action Plan (RAP) will comprehensively address compensation and resettlement; sensitization process is ongoing.
What about the cultural and historical heritage of the area?
Amu Power has hired some experts to look into the cultural heritage of the area. There are many pastoralists communities that come to graze their cattle there during the dry season. The effects of some of these issues are still under investigation.
Amu Power also has a drug/alcohol abuse policy. The company will implement a no-drug/alcohol policy in the power plant as we respect and value the Islamic culture which is predominant in the area.
What about the communities living there?
Amu Power has been involved in CSR. It is building a computer lab at Balgoni Primary School, constructing a 20 km water pipeline and also funding early childhood programs. We are also building a cold storage in Makowe so that fishermen can be able to store a lot more fish and sell it far and wide. We are also giving out fishing nets, building seawalls, and putting up street lights and carbro on the main Lamu Island.
Afforestation of the county is also one of Amu’s projects. Mangrove trees are very sensitive yet they are very important to the environment. Mangroves clean water, it’s also where fish lay their eggs, they are also used as timber for construction in local houses and also act as beams.
Amu Power is also building a new school that will cater to primary and high school students, opening a new medical facility which is accessible to everybody, building a brand new school in Stone Town, and training youth by giving them capacity building through courses. There is also a plan to create a program with the government where 1000 youth can be taken to the National Youth Service and trained. Afterwards they will be guaranteed jobs once construction begins.
We have also been meeting with stakeholders including Save Lamu – which is a collaboration of 36 civil societies. Amu has also consulted with MCAs, the Senate, the County government and other local leaders and sharing the company’s vision and seeking their views. We have also traversed the county and done consultations. Amu Power is committed to constantly interacting with the community to address any issues that may arise.
The economic impact of the project
The project will cost Ksh. 180, 000 billion. 20% will go directly into the local economy. That is 36 billion shillings a month. That means Amu Power will be spending Ksh. 1 billion per month in the economy for the 36 months it will take to construct the plant. To understand how much Ksh.1 billion is for the economy, you need to understand how much Lamu County gets. For 2014/2015 Lamu County got Ksh. 1.7 billion of which Ksh. 1.1 billion was recurrent budget. For the year 2015/2016 Lamu will be getting Ksh. 2.3 billion annually. Imagine the direct and indirect impact of having Ksh. 1 billion in such an economy. It will create serious growth and make Lamu County an economic powerhouse.