By Jemosop Faith
Kenya is a renewable energy powerhouse, with 90% of its electricity from geothermal, hydro, wind, and solar. Yet, it leans heavily on Ethiopia for power, importing 11% of its daily electricity from its northern neighbor. Why does a nation with abundant resources depend on another’s grid? And what does this mean for Kenya’s energy future? Let’s unpack this paradox.
How Reliant Is Kenya on Ethiopia for Its Energy Supply?
Kenya’s electricity landscape is impressive. With an installed capacity of 3,321 MW in 2023, it powers 84% of its population, up from 32% in 2013. Geothermal leads at 40% of grid supply, followed by hydro (24%), wind (17%), and solar (3%). Yet, Ethiopia power supplies 200 MW daily via a 1,045-km HVDC line, saving Kenya $10 million annually at 6.5 US cents per kWh, cheaper than local IPPs.
Imports surged 66.7% in 2024, with Ethiopia as the primary supplier due to its affordable hydroelectricity. Kenya also imports smaller amounts from Uganda, but Ethiopia’s 39.73 million kWh in January 2023 dwarfs Uganda’s 28.75 million. This grid dependency, while cost-effective, raises questions about self-reliance.
Can Power Imports from Ethiopia Meet Kenya’s Growing Needs?
Kenya’s energy demand is soaring, projected to rise from 2,600 MW to 3,600 MW by 2030. Peak demand hit record highs in 2024, straining the grid, especially from 6–10 PM. Ethiopia’s 25-year deal to supply 200 MW, scaling to 400 MW by 2026, offers relief.
Negotiations for an additional 50–100 MW aim to avert rationing. Ethiopia’s 5,200 MW capacity, 90% hydro, and plans for 17,000 MW by 2032 suggest surplus potential. However, droughts cut Ethiopia’s exports to 100 MW in 2023, exposing vulnerabilities.
Kenya’s own hydro plants, like Masinga Dam, faltered during droughts, necessitating imports. While Ethiopia’s supply stabilizes Kenya’s grid, it may not scale fast enough for a population growing by 1 million annually.
What Risks Does Kenya Face by Depending on a Foreign Grid?
Grid dependency carries risks. Geopolitically, Ethiopia’s Grand Ethiopian Renaissance Dam (GERD), the source of Kenya’s imports, is contentious, with Egypt and Sudan raising concerns over Nile water flows. Tensions could disrupt supply.
Economically, currency fluctuations and import reliance strain Kenya’s balance of payments, especially with high sovereign debt. Ethiopia’s 800-hour annual outages and 15% grid losses highlight technical risks.
Climate change, causing frequent droughts, threatens Ethiopia’s hydro-heavy grid, as seen in 2023’s reduced exports. Over-reliance also disincentivizes local investment, with Kenya’s $14–18 billion funding gap for grid expansion unmet. These risks underscore the fragility of Africa energy trade when domestic systems lag.
Will Decentralised Solar Offer a Better Solution for Energy Independence?
Renewable alternatives like solar could reduce Kenya’s grid dependency. Kenya’s 5–7 peak sunshine hours daily and 4–6 kWh/m² insolation make it ideal for solar. Solar home systems (SHS) serve 71% of rural households, bypassing the grid. 19 off-grid diesel stations are converting to solar-diesel hybrids, and 43 new solar mini-grids are planned.
M-KOPA’s 1 million solar systems show scalability. Solar’s cost, at $0.10–0.15 per kWh long-term, rivals Ethiopia’s imports. VAT exemptions on solar products since 2021 boost affordability. However, cheap Chinese imports and battery costs challenge growth. Scaling solar requires $25 billion for transmission infrastructure and local manufacturing to reduce import reliance.
Could Regional Energy Trade Be a Short-Term Fix with Long-Term Costs?
Africa energy trade, like the Ethiopia-Kenya electricity highway, fosters collaboration. The Eastern Africa Power Pool (EAPP) enables Kenya to import from Ethiopia and Uganda, with plans to export to Tanzania. This saved Kenya $10 million in 2023 and stabilized supply during droughts.
Harmonized policies under the AfCFTA could boost trade, attracting $45 billion annually for capacity. Yet, long-term costs loom. Over-reliance risks economic dependence, as seen in Kenya’s trade deficits.
Ethiopia’s export focus may prioritize foreign revenue over domestic needs, straining ties. Regional trade delays local grid upgrades, with Kenya’s transmission constraints limiting renewable integration. Trade is a band-aid, not a cure.
Kenya’s reliance on Ethiopia power is a pragmatic but risky choice. Ethiopia’s 400 MW by 2026 will ease pressure, but droughts, geopolitics, and economic strains threaten stability. Decentralized solar, with Kenya’s vast potential, offers a path to independence, but needs investment and policy support.
