5 things to look out for about Kenya’s energy efficiency market in 2016
Written by Chris Mbori
2015 was the big year for the energy efficiency market in Kenya. This was largely because the rush to beat the energy management regulations 2012’s deadline. This regulation states that any designated facility ( one that consumes more than 180,000kWh per annum) to comply to a set of regulations. Some of the designated facilities that needed to comply with the regulations rushed to undertake an energy audit and comply. With the deadline now gone and no much action in the market since, is there still any opportunity in the energy efficiency market in Kenya? I believe there still do exist. Here are five reasons I think will create opportunities in 2016;
- Compliance will still be a need;
I don’t think we are done with compliance of energy management regulations 2012. The last time I checked, only about 600 designated facilities that had done the energy audit. More than 3000 designated facilities had still not complied. Word is that the regulator is planning serious surprises for the non-compliant energy consumers. If the regulator will act, we shall definitely see a more vibrant market in 2016.
- Implementation of energy efficiency projects;
There will be a great need for high energy consumers to implement the energy efficiency measures recommended by energy audit firms. Already we are seeing business taking an ESCO approach to help designated consumers easily implement energy efficiency projects. These ESCO companies fully finance and implement the projects only to be paid from the savings gained. A good example is ICOPOWER that uses this approach for voltage optimization projects. They have already installed dozens of these optimizers to interested clients.
Since the energy efficiency market is growing, there is a strong need for training that will help equip professionals with the right skills needed in the market. Already Kenya Association of Manufactures and Association of Energy Professionals are conducting the CEM course. The designated energy users also need awareness training that will help them implement the energy efficiency recommendations and set up sustainable energy management systems.
- Solar thermal/ Solar Hot Water;
The solar hot water market is largely driven by compliance. Already there is a regulation that requires any facility that uses more than 100 litres of hot water to install a solar hot water system that gives at least 60% of their hot water demand. The regulation aims at new and existing buildings. For existing buildings, the deadline is 2017. New buildings are not connected to the electricity grid unless they comply. Besides the regulations, the solar hot water market offers great energy savings and is a no brainer to anyone using electricity to heat water. Paybacks are less than a year. This makes it an attractive investment in our sun-rich Kenya.
- Solar Photo Voltaic (PV);
With the cost of Solar PV coming down and more financing mechanisms in place for Solar PV projects, there is going to be more uptake of solar generated electricity in Kenya this year. Besides, there are companies that offer leases for the Solar PV systems. One good example is Nvision. They use the Build Own Operate Transfer model to supply electricity from solar and sell it to the client at a rate cheaper that Kenya Power. This approach has endered them to many clients as it guarantees a near zero risk and direct cost savings in electricity charges.
The opportunities are probably not limited to above. Anyone energy business that will add value to clients will definitely have a great 2016. In energy efficiency, value is to reduce energy cost, cut on consumption, reduce carbon emissions and definitely, in Kenya, compliance to the regulations.
Bio of Writer;
Chris Mbori is a Technical Director at Eenovators Limited. He is a CEM, CMVP and a Licensed Energy Auditor in Kenya. He has over 6 years experience in the Energy Industry having done over 100 energy audits in the last 2 years. You can reach him through email@example.com