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murchr
#31 Posted : Tuesday, August 21, 2012 7:50:07 PM
Rank: Elder

Joined: 2/26/2012
Posts: 15,980
Kausha wrote:
@murchr our deficit is 350MW at the moment. Which 1260MW peak demand against 1290MW installed capacity and the 30% reserve we need to build up. All the IPP's have 10-15 years irrevocable power purchase agreements. They are no going away soon. Demand is growing at 8%. Why produce all this power for who? Vision/ Mirage 2030 perhaps?

Power rationing are from the decrepit transmission lines and commercial theft. KPLC is fixing that by replacing some lines and build substations to distribute the consumer load across many substations so that one line shutting down doesn't shut everyone. At the moment Mombasa is producing excess power which can't be evacuated owing to an old transmission line from Mombasa to nairobi.

Power is expensive because of the sources and not because it is scarce. Geothermal is equally expensive in our basket of energy falling just below thermal. Hydro is the cheapest followed by wind and baggase. IPP's have 10,15,20 year PPA's so their input in the base load will always be there and together with geothermal will keep prices up. Download KPLC annual report and check the rates.

Egypt don't need our power, they have natural gas which they use and the rest they supply Israel, lebanon na hao wengine.


My friend the reason why we have power rationing is because of drought since we rely so much on hydro power yet we cant control the weather.

On Egypt..get the current news on how the current supply is unable to meet demand. Let me ask...is there an issue if Kengen produces power with the intention to sell to our neighbors? We buy power from Uganda and are planning to get more from Ethiopia. If Somalia settles down, who will supply them with power?

Currently the country's installed capacity is 1,600MW The peak load is projected to grow to about 2,500MW by 2015 and 15,000 MW by 2030. To meet this demand, the projected installed capacity should increase gradually to 19,200 MW by 2030.
Egypt right now has a capacity of 17,000MW and SA has an installed capacity of 44,000MW...surely Kenya is a dwarf. If Egypt can have power problems with such capacity...how can our 1,600MW be enough?

KRC or is it RVR is planning to electrify the railsystem, how much power will that need?
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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  | | Edit by user: Tuesday, August 21, 2012 8:17 PM | Reason: Not specified
sparkly
#32 Posted : Wednesday, August 22, 2012 6:46:40 AM
Rank: Elder

Joined: 9/23/2009
Posts: 8,083
Location: Enk are Nyirobi
[quote=mkonomtupu]"Power producer (KenGen) is shopping for financial consultants to advise on the modalities of raising a massive Sh420 billion ($5 billion) in a fresh financing programme.

The new funding proposal comes barely three years after the utility firm raised Sh25 billion through a public infrastructure bond to fund the expansion of its electricity generating installations....
The consultants will be expected to advise on the best option of executing the proposed financing plan in line with the company’s corporate leverage ratio of 70 per cent debt and 30 per cent equity.

The tender, which has attracted seven consortia of both local and international bidders, will be awarded next month..."
http://www.standardmedia...fresh-capital-injection[/quote]

This will mean new equity of over KES 120 B. I see another IPO, rights issue and hybrid instrument aka pref shares to be taken up by GOK.
Life is short. Live passionately.
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chiaroscuro
#33 Posted : Wednesday, August 22, 2012 8:59:04 AM
Rank: Veteran

Joined: 2/2/2012
Posts: 1,134
Location: Nairobi
murchr wrote:
chiaroscuro wrote:
murchr wrote:
I may be wrong but i thought the money used for projects is gotten from public infrastructure bonds??


A.K.A. LOANS


Which they said they are being offered at 1%


The PIB pays 12.5% [tax free!] to investors. In other words, this is how much it is costing KenGen... RINK:http://www.kengen.co.ke/PIBO/Abridged%20IM.pdf
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chiaroscuro
#34 Posted : Wednesday, August 22, 2012 9:06:13 AM
Rank: Veteran

Joined: 2/2/2012
Posts: 1,134
Location: Nairobi
Kausha wrote:
So who will consume all the power? We are yet to feed ourselves and medicate and treat ourselves to a decent standard. The economy is growing at 3- 5 % at best and is unlikely to move beyond that over the next 3 years, so what is all this capacity for?


I think you have your economics upside-down: do you wait for economy to grow then boost power production or do you boost power production in order to spur economic growth?

If you ask investors to give you sh15b for 10 years for the purpose of buying food and medicine for the poor, do you think they will agree?
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Ericsson
#35 Posted : Wednesday, August 22, 2012 9:59:35 AM
Rank: Elder

Joined: 12/4/2009
Posts: 10,809
Location: NAIROBI
The economic growth is too low but the power is required for future and current use to alleviate shortages.
Better prepare for the future now than wait for the future to prepare you when it catches up with u
Wealth is built through a relatively simple equation
Wealth=Income + Investments - Lifestyle
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Kausha
#36 Posted : Wednesday, August 22, 2012 1:41:36 PM
Rank: Member

Joined: 2/8/2007
Posts: 808
@much...& chur, I think you are the ones who have got your economics wrong. First We only have just under 1,300MW installed capacity..surely google Kenya Installed capacity and stop ready gabbage from the ministry of energy on www.energy.co.ke. It's mostly stomaeconomics. We are at peak demand of 1,280MW and demand has been growing at 8% since 1996 to 2011. There is nothing happening to suggest we will grow demand beyond 10% before 2015. Peak load should be 2000 MW at 2015. We rarely buy from Uganda, they don't even have any to sell, we sell them a bit but once Bujagali is done, they probably won't need any more because they are also producing oil shortly and Karima Hydro should be starting off shortly. Meanwhile we have excess power at Kipevu which can't be evacuated, so you can see it's not very difficult to end up with excess power. You also forget once we start producing oil, Turkana and Marsabit will be on Thermal througout. On KRC and RVR if we can't move cargo, we have no business talking electic trains yet.
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mkonomtupu
#37 Posted : Wednesday, August 22, 2012 3:07:02 PM
Rank: Veteran

Joined: 2/10/2010
Posts: 1,001
Location: River Road
@Kausha, it's now very easy to parachute a factory and be ready for production within a month, 1300mw installed capacity would not be even enough to run an integrated iron and steel plant to e.g. exploit the iron ore in Tharaka. How do hope to attract investors if you don't have energy capacity? You also forget that to transport the waxy oil from turkana you need to use the heated pipeline.
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Kausha
#38 Posted : Wednesday, August 22, 2012 4:23:39 PM
Rank: Member

Joined: 2/8/2007
Posts: 808
There is no waxy oil, this is gabbage media likes to spew every once in a while. They said Uganda had waxy oil, which was gabbage and now I see they are talking about Kenya's oil being waxy. All I am saying is that Kengen is wittingly or unwittingly wrecking shareholder value through it's inefficiently organized financing. Now they want 120B equity for power projects this just means super dilution of existing shareholders to allow other big boys to come in meaning we are unlikely to ever get decent returns yet with a bit of financial engineering Kengen can deliver massive value for shareholders. My issue is that the need to maximize profitability of projects and not just create because there is mirage 2030, possibility of an electric rail etc. What if Mirage moves further and the electric train is out by 2 years, shareholders are toast. Already Kipevu III financed by Kengen Infrastructure bond is burning shareholders in a way.
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the deal
#39 Posted : Wednesday, August 22, 2012 5:19:43 PM
Rank: Elder

Joined: 9/25/2009
Posts: 4,534
Location: Windhoek/Nairobbery
@Kausha Kenya is already connected to the SADC power pool, a region which is faced with severe energy shortages in the next 3-5 years, expect Kengen to channel some of its capacity in that direction, the infrastructure is already there...I don't see a rights issue either due to the current depressed share price I expect the following.

1. A Secondary IPO followed by issuing of Preference shares

2. A convertible bond
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murchr
#40 Posted : Wednesday, August 22, 2012 5:26:01 PM
Rank: Elder

Joined: 2/26/2012
Posts: 15,980
Kausha wrote:
There is no waxy oil, this is gabbage media likes to spew every once in a while. They said Uganda had waxy oil, which was gabbage and now I see they are talking about Kenya's oil being waxy. All I am saying is that Kengen is wittingly or unwittingly wrecking shareholder value through it's inefficiently organized financing. Now they want 120B equity for power projects this just means super dilution of existing shareholders to allow other big boys to come in meaning we are unlikely to ever get decent returns yet with a bit of financial engineering Kengen can deliver massive value for shareholders. My issue is that the need to maximize profitability of projects and not just create because there is mirage 2030, possibility of an electric rail etc. What if Mirage moves further and the electric train is out by 2 years, shareholders are toast. Already Kipevu III financed by Kengen Infrastructure bond is burning shareholders in a way.


Waa...lol!! Is this guy lying? http://wazua.co.ke/forum...sts&t=14926&p=16
"There are only two emotions in the market, hope & fear. The problem is you hope when you should fear & fear when you should hope: - Jesse Livermore
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  | | Edit by user: Wednesday, August 22, 2012 5:39 PM | Reason: Not specified
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