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Electricity supply from Lamu Power Plant could cost more than originally estimated3 minutes read

Construction of the plant on the Kenyan mainland opposite the tourist island of Lamu was scheduled to begin in 2015

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Kenyan activists reject the governments idea to construct coal-fired Lamu Power Plant

Electricity from a coal-fired power plant to be named Lamu Power Plant due to be built in Kenya by a Kenyan-Chinese consortium will cost consumers up to 10 times more than planned. Construction of the plant on the Kenyan mainland opposite the tourist island of Lamu was scheduled to begin in 2015 but has been repeatedly halted, due in part, to opposition by environmentalists.

Amu Power, a consortium comprising Kenya’s Gulf Energy and Centum Investment and a group of Chinese companies, is due to building the plant after winning the government contract. The Plant’s backers say it will help tackle Kenya’s frequent blackouts by increasing generation capacity by nearly a third and generating power that would cost about half what consumers currently pay.

But opponents say those costs are much higher than projected. Amu Power says electricity from the plant will cost 7.2 U.S. cents per KWh. But that is “highly optimistic,” the U.S.-based Institute for Energy Economics and Financial Analysis said in an independent study, which is the most extensive so far on the plant’s cost. It said the 1000-MW coal-fired plant’s 25-year power purchasing agreement would cost consumers more than $9 billion, even if it does not generate any power.

Activists march in Nairobi, to denounce plans by the Kenyan government to mine coal close to the pristine coastal archipelago of Lamu
Activists march on June 5, 2018 in Nairobi, carrying placards bearing messages to denounce plans by the Kenyan government to mine coal close to the pristine coastal archipelago of Lamu, on World Environment Day. – Kenya is set to build a 981.5 megawatt (MW) coal-fired thermal electricity-generating plant in the Manda Bay area, Lamu County, even as costs of renewable energies are falling dramatically and fuelling a push to phase out coal power generation around the world. (Photo by TONY KARUMBA / AFP)

Related: Kenya’s Lamu Island gets investment ready with infrastructure projects worth $27 billion

“The true costs of Lamu’s electricity during the years 2024 through 2037 could average as high as US 22 to US 75 cents per KWh — three to 10 times the company’s 2014 projection,” the study noted. “We believe Kenya should cancel the project.” The study said the plant’s backers had underpriced coal imports and rising operational and maintenance costs.

Joseph Njoroge, principal secretary at the Ministry of Energy, says the plant was competitive but did not address specific concerns. The plant’s location on the mainland in the coastal Lamu County region is about 14 km from Lamu Island, a famous ancient Swahili settlement and UNESCO World Heritage site and a top tourist destination.

Environmentalists say the plant will pollute the air, destroying mangroves and breeding grounds for five endangered species of marine turtles, fish and other marine life. In 2018, a Kenyan court suspended the project for a second time, sending the dispute back to an environmental tribunal. It is expected to issue a decision later this month on whether the project can go ahead.

Related: To tackle financial crime, Kenya is withdrawing its old 1,000 shilling version

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Heavy rains threaten Uganda’s coffee crop quality

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Uganda’s coffee crop quality could see a decline in the coming months as heavy rains across the country have reduced the amount of sunshine necessary for bean drying.

Uganda is Africa’s largest exporter of coffee followed by Ethiopia and grows mostly robusta variety.

The country has been pounded by unusually heavy rains that started in August resulting in deaths, displacement and extensive damage to roads and other infrastructure.

Western Uganda, including the foothills of the Rwenzori mountains , some of the biggest coffee growing areas, has received some of the most intense rains.

Uganda Coffee Development Authority (UCDA), the state-run regulator, forecasts Uganda’s bean exports will climb 16 percent to 5.1 million 60-kg (132-pound) bags in the current crop year ending September.

The country’s coffee output has surged in recent years, the fruition of a government programme that has been distributing free seedlings to farmers to expand acreage and replace aging trees.

Authorities say their target is to help boost annual production to 20 million bags by 2025.

The beans have traditionally been Uganda’s biggest commodity export but were recently overtaken by gold which now annually earns the country over $1 billion.

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Business rescue team rule out mid-June return for SAA flights

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South African Airways business rescue practitioners have rejected an “unvetted” statement released by the state-owned airline indicating plans to resume domestic flights from mid-June.

The national carrier had on Tuesday, announced that its planes will be back in the skies between Johannesburg and Cape Town.

But Les Matuson and Siviwe Dongwana, the business rescue administrators, say the airline had breached communications protocol by issuing a statement which “created an unfair expectation on our relevant stakeholders, including SAA’s customers, as well as employees who are on unpaid absence as a result of the travel ban which led to the halting of the company’s operations, compounding its financial distress.”

SAA’s media statement had gone out without the approval of the practitioners as demanded by the business rescue procedure.

With the government of South Africa announcing that the country will enter into lockdown alert level 3 from June 1, domestic air travel will be permitted but only for business purposes.

The business rescue practitioners said SAA planes will remain grounded until a better understanding of what the level 3 regulations entail.

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Tanzania, France sign water supply loan agreement

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Tanzania has signed a loan agreement with France to finance water supply projects that will benefit about 770,000 people in the country’s Morogoro municipality.

The French government will extend the loan worth about $76 million to Tanzania through its French Development Agency (AFD), according to Dotto James, the Permanent Secretary in the Ministry of Finance and Planning who signed the agreement on behalf of Tanzania.

“Upon completion, the water supply in the Morogoro municipality will increase from the current 37,000 cubic meters a day to 108,000 cubic meters a day,” James told a press conference following a signing ceremony in Morogoro.

AFD Country Representative for Tanzania, Stephanie Mouen says the project will improve the well-being of the people in the municipality and it will also improve the environment.

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