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6 Feb 2022

Kenya: Lamu Coal Power Plant

The Lamu Coal Power Station is a now-suspended 1,050 MW supercritical power plant that was to be built in Kwasasi, on the shoreline of Manda Bay, close to Lamu Old Town, a UNESCO World Heritage site, in Kenya. The two-billion-USD coal-fired power plant (Kenya’s first) and the associated facilities were closely linked to the Lamu Port–South Sudan–Ethiopia Transport (LAPSSET) Corridor mega-infrastructure project. After years of campaigning and widespread opposition from local communities and civil society, in 2019 Kenyan courts cancelled the project’s environmental license, and in 2020 the Industrial and Commercial Bank of China announced it had withdrawn plans to finance it.

Project Impacts

  • Employment: Project proponents claimed the plant would have generated local employment, but assessments showed the jobs created would have largely been low-skilled, dropping from around 1,200 during construction to 250 during operation. Most locals were unlikely to qualify for these operating positions.
  • Environment: A technical report by Greenpeace found the project would have resulted in extremely high emissions of air pollutants—likely to cause severe health impacts for local people. Dredging and wastewater disposal would have harmed marine life, including mangroves, seagrasses, and coral reefs, as well as the animals that depend on them. Fly ash, acid deposition, and acid rain could have reduced farmers’ yields and introduced toxic metals into food and water supplies.
  • Climate Change: The plant would have become Kenya’s single largest emitter of greenhouse gases, potentially releasing 8.8 million tonnes of carbon dioxide into the atmosphere each year—single-handedly doubling current greenhouse gas emissions from the energy sector.
  • Biodiversity: Lamu is a biodiversity hotspot, containing extensive systems of dense terrestrial forest, mangrove, and baobab forest, marshlands, grasslands, savannahs, sand dunes, beaches, and networks of creeks and water channels, which provide vital habitat and nurseries for many marine species. Numerous recognised biodiversity areas near the proposed project area would have been threatened by the power station and associated activities.
  • Land Acquisition and Compensation: Even though the plant has not moved forward, there have been escalating disputes over displacement and compensation for loss of land and natural resources due to the project. More than 100 farmers were displaced by road construction without compensation. Local farmers have struggled due to a lack of information and consultation and faced irregularities in compensation schemes that excluded many and created uncertainty for those not yet displaced.
  • Indigenous Peoples and Cultural Heritage: Most of Lamu’s population are Indigenous and have historical ties to the land and resources, which they manage and utilise according to tradition. The damage the project would have caused to the local environment and the cultural and architectural integrity of Lamu Old Town and other archaeological sites across the area threatened Lamu residents’ lives, livelihoods, and culture.
  • Armed Conflicts: Lamu borders Somalia and faces a complex security situation. Travel in some areas is dangerous, with kidnappings, killings, and attacks in recent years. This insecurity has constrained local campaigners’ operations and has been used as justification by police and other officials to investigate, intimidate, or curtail the activities of community and civil society activists.
  • Debt Sustainability: Although there are questions about the economic viability of the project, the Kenyan electricity utility would have been contractually obliged to pay 362 million USD in minimum capacity charges annually for 25 years. Project documents show the Kenyan state would have been liable for almost all project risks, which taxpayers would ultimately cover. The project would also have added to Kenya’s external public debt, about 20% of which in 2020 was owed to Chinese banks.
  • Governance: The project and its developer, Amu Power, have enjoyed support from several high-level government officials, sweeping government-backed risk guarantees, favourable interest rates, fee waivers and exemptions, fast-tracking of regulatory approvals, and nominal oversight. Meanwhile, local communities have struggled to obtain pertinent information about the project.

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