Big power of small organizations: like many other African countries, Kenya suffers power shortages, and the situation in rural areas is even more difficult than in the cities. Now a small group in Kenya's Central Province has decided it cannot wait for the government's rural electrification programme to make its way to their doorstep. They have decided to take matters into their own hands. Albert Muriuki reports from Nairobi.

The inefficiency and incompetence of Kenya's official power supplier finally drove Mzee Ngai into action. He applied for an electricity connection to the Kenya Power and Lighting Company (KPLC) in 1994. "For 14 years, I waited patiently for KPLC to come and bring electricity. In 2005, T just got fed up. I was getting no younger - 14 years of waiting to get connected to electricity was just too much!" he says.

While the general inefficiencies of Kenya's parastatals is well known, there was also a political angle to this. In the 1990s, the then KANU government under former president Daniel arap Moi used its political muscle to deny amenities to areas that were deemed to support the zopposition. Central Province, the biggest opposition area, bore the brunt of this campaign.

In 2005, Ngai and other like-minded villagers decided to take matters into their own hands. Situated close to Kenya's biggest water catchment area, the Aberdares Range, they decided to harness water from the local Gikira River that flows from it. In late 2005, they formed the Gatiki Electrical Company and sold shares to interested villagers for Kshl0.00 ($130) each. Tired of living in the dark, villagers were enthusiastic and joined in large numbers. The company decided to set up three projects: in total, they have around 7,000 shareholders, whom Ngai refers to as "members".

The members come from three neighbouring locations in Nyeri South and Murang'a North districts. They have set up a project that has the potential to change the livelihood of the area - and provide inspiration for other areas to find alternatives to government's slow progress.

"People are poor, but they were so enthusiastic about the project that even those who could not afford the $130, paid what they could, so we have members who paid $25 and have slowly been raising their stakes in the company," Ngai says. But even the contributions from the villagers could not raise the full amount needed to start a hydro electric system.

[ILLUSTRATION OMITTED]

To make up the shortfall, the company found support from a new source of funding.

Tom Morton, Executive Director of JPMorgan ClimateCare in Kenya, says that the company has committed to an initial payment of $100,000 for the first project of a series of three, in return for carbon-emission reductions.

This will be paid once the project is registered with the Gold Standard Foundation. "We are taking it through the process at the moment - we have written the product design document and it is being assessed by the Gold Standard Foundation," he said.

Gatiki Electrical Company started using its own hydro-generated power at the end of December 2008 and if the trial runs are anything to go by, the members of the group will soon be getting electricity for less than a dollar a month. The company actually runs three different projects-Chiki, which is set to produce 0.75MW, Kiawambogo, which will produce 0.375MW, and Gacharageini, which will produce 0.25MW. "So far, the test runs have been very promising," says Joseph Mbugua, the chairman of the company.

In Child, the project started with members setting up a 300m long trench to divert water from the river to a 130ft cliff. The gushing waters then turn the turbines to produce 0.75MW of power. "All our trial runs have gone well, and we hope to have installed electricity in every household by the beginning of 2009.

Each household will be supplied with electricity depending on how its members want to use electricity," he says, adding that power limiters will be installed in every household. Members will be classified depending on the amount of power they require and the limiters will switch off the electricity if it exceeds the agreed amount.

Each consumer of the electricity will pay a minimum of $ 0.65 and a maximum of $1.25 each month, which is considerably cheaper than what Kenyans pay the KPLC for electricity. Villagers have also put in labour as an in-kind contribution.

Unfortunately, so as not to fall foul of the law, the company is unable to generate more than 3MW of power from the three installations. Under Kenyan laws, a permit is required for generating plants with capacity exceeding 1MW. Members of the company can be imprisoned for two years and pay a fine of $25,000 if they flout this law. Where this limit is exceeded, the power has to be fed into the national grid, and a power purchase agreement has to be negotiated.

Local solutions

According to the IMF's Regional Economic Outlook for sub-Saharan Africa, in 2007 alone, nearly two thirds of the countries in the region experienced an acute energy crisis with frequent and extended electricity outages or no electricity at all. Although conflict and drought triggered several of these crises, in most cases the cause was electricity supplies failing to keep pace with growth in demand. In many rural areas of sub-Saharan Africa, electricity access can be as low as 1%, with an average of about 8%.

Sub-Saharan countries, except South Africa, depend heavily on biomass, i.e. wood, animal dung, agricultural waste, and other organic forms, for more than 80% of their energy use. Electricity use per capita is less than 2%, and in most countries, electricity consumption has stagnated.

In Kenya, rural electrification contains a considerable subsidy element, which may actually impede the speed of the roll out. To date, KPLC charges new customers a connection fee of $458, with a down payment of just under $200 and the rest paid in 12 monthly instalments. For rural business customers, the fees are around $200, with a down payment of $64 and the remainder paid over 10 months.

After this, clients are faced with relatively high electricity charges - power prices rose by more than 100% in 2008. If this Gatiki startup is successful, the combination of private investment, small-scale operations and carbon credits offers a powerful model for localised solutions to address the high costs and limited supplies in Kenya's power sector.