Renewable energy market analysis in Kenya
Rutich, Bartholomew (2015)
Rutich, Bartholomew
Laurea-ammattikorkeakoulu
2015
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Julkaisun pysyvä osoite on
https://urn.fi/URN:NBN:fi:amk-201505259999
https://urn.fi/URN:NBN:fi:amk-201505259999
Tiivistelmä
This thesis was a research project conducted as part of the CONNECT project at Laurea University of Applied Sciences. The main aim of the project was to examine the current renewable energy situation and the opportunities for market entry for Finnish small and medium enterprises (SMEs) in Kenya, so as to support growth and accelerate internationalization in developing countries.
The availability of renewable energy sources in Kenya is enormous and about 77 percent of the people in Kenya have no access to electricity. This thesis examines the demand for electricity in Kenya, as well as the main competitors and how best to enter the market.
A qualitative research approach was used in this thesis project and questionnaires were sent to companies in the renewable energy field owned by the Kenyan government and also to the Finnish company, Finpro, which helps to internationalize Finnish SMEs. FinPro was chosen because it has experience in both the Kenyan and Finnish markets and is in a good position to guide the Finnish SMEs. The Kenyan company interviewed was the Kenya Electricity Generating company (KenGen). The investigations in this thesis help to provide information required to establish renewable energy sources in Kenya whether in urban or rural areas. The Kenyan Government encourages foreign investors to invest in this area by zero-rating import duty and removing Value Added Tax (VAT) on renewable energy, equipment and accessories. The ERC has prepared solar water heating regulations. These steps are intended to mitigate the challenges faced in exploiting the solar energy resource.
Kenya relies mainly on hydro-electric power which is unreliable due to changing weather con-ditions and increase in dry seasons. Kenya has high light intensity sunlight for 5-7 peak sunlight hours a day that can be tapped for solar energy, the greatest potential being in northern Kenya. Kenya has the potential for up to 3,000 MW of wind, especially in the wind-rich Northern frontier districts. While geothermal energy in Kenya has a potential of up to 10,000 MWe which is under-exploited in the rift valley. Biogas is not much documented but is an area of high potential as well, since most Kenyans are animal farmers.
Kenya is a gateway to East and Central Africa and with the establishment of the East African Community, which comprises Kenya, Uganda, Tanzania, Rwanda and Burundi; there is a po-tentially large market for Finnish SMEs. Finally, Kenya has a growing free market economy and Kenya joined the middle income economies.
The availability of renewable energy sources in Kenya is enormous and about 77 percent of the people in Kenya have no access to electricity. This thesis examines the demand for electricity in Kenya, as well as the main competitors and how best to enter the market.
A qualitative research approach was used in this thesis project and questionnaires were sent to companies in the renewable energy field owned by the Kenyan government and also to the Finnish company, Finpro, which helps to internationalize Finnish SMEs. FinPro was chosen because it has experience in both the Kenyan and Finnish markets and is in a good position to guide the Finnish SMEs. The Kenyan company interviewed was the Kenya Electricity Generating company (KenGen). The investigations in this thesis help to provide information required to establish renewable energy sources in Kenya whether in urban or rural areas. The Kenyan Government encourages foreign investors to invest in this area by zero-rating import duty and removing Value Added Tax (VAT) on renewable energy, equipment and accessories. The ERC has prepared solar water heating regulations. These steps are intended to mitigate the challenges faced in exploiting the solar energy resource.
Kenya relies mainly on hydro-electric power which is unreliable due to changing weather con-ditions and increase in dry seasons. Kenya has high light intensity sunlight for 5-7 peak sunlight hours a day that can be tapped for solar energy, the greatest potential being in northern Kenya. Kenya has the potential for up to 3,000 MW of wind, especially in the wind-rich Northern frontier districts. While geothermal energy in Kenya has a potential of up to 10,000 MWe which is under-exploited in the rift valley. Biogas is not much documented but is an area of high potential as well, since most Kenyans are animal farmers.
Kenya is a gateway to East and Central Africa and with the establishment of the East African Community, which comprises Kenya, Uganda, Tanzania, Rwanda and Burundi; there is a po-tentially large market for Finnish SMEs. Finally, Kenya has a growing free market economy and Kenya joined the middle income economies.