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    Technical Efficiency of Thermal Electricity Generators in Kenya

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    Date
    2020
    Author
    Njeru, Grace
    Gathiaka, John
    Kimuyu, Peter
    Type
    Article
    Language
    en_US
    Metadata
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    Abstract
    The Government of Kenya introduced energy sector reforms in the late 1990s aimed at improving efficiency in the supply of energy. After over two decades of reforms, there has been no comprehensive study to estimate the technical efficiency amongst electricity generators in Kenya. This study examined 27 thermal electricity generating plants in Kenya using data sourced from Energy Regulation Commission for the period July 2015 to December 2017. The study applied two methods to estimate efficiency, viz., the Stochastic Frontier Analysis and Data Envelope Analysis. The results indicated that there is inefficiency in thermal power generation. The average efficiency score was 71% meaning the industry was missing its technical potential by about 29%. The plants experienced increasing returns to scale and were improving on efficiency and productivity. Age and public ownership contributed to inefficiency while grid connection had a positive effect on efficiency. The government should encourage private investment in future power generation projects while at the same time increasing connection of the isolated areas to the national grid. The regulator should also revisit the current specific fuel targets used in determining the fuel pass through costs to consumers to encourage efficiency
    URI
    https://econjournals.com/index.php/ijeep/article/view/9102/5032
    http://erepository.uonbi.ac.ke/handle/11295/109359
    Citation
    .International Journal of Energy Economics and Policy.10(3), 340-347
    Publisher
    Njeru,G Gathiaka,H & Kimuyu P (2020).Technical Efficiency of Thermal Electricity Generators in Kenya. International Journal of Energy Economics and Policy
    Subject
    : Technical Efficiency, Electricity Generation, Stochastic Frontier Analysis, Data Envelope Analysis, Kenya
    Collections
    • Faculty of Arts & Social Sciences (FoA&SS / FoL / FBM) [6704]

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