Background information on the Kenya’s crisis on biomass energy

Introduction
Kenya faces a number of economic, social and environmental challenges. During a period of 40 years, the country fell from one of the most promising developing countries in sub-Saharan Africa, both in terms of growth and social development, to a stagnated economy struggling to find a new roadmap of sustained growth. Between 1972 and 2003, for example, despite real GDP growing at an annual average rate of about 3.3 per cent, per capita real GDP only grew at about 0.2 per cent per annum, reflecting growing population The high growth rate in 2004 is partly attributable to the adoption of a new data system, the SNA 1993, which added hitherto poorly captured economic sectors such as SMEs and the horticultural sector. Available data also revealed that real per capita income in 2003 (about US$426) was well below the figure the country achieved in the late 1970s.
In 2003, the economy continued with its gradual economic recovery by posting a real economic growth rate of 1.8 per cent, up from 1.2 per cent in 2002. The recovery strengthened further in 2004 when the economy grew 4.3 per cent4 and in 2005, 5 per cent. Despite these gains, however, the country’s poverty status remains largely unchanged. It is estimated that it would take 350 years for real capita income to double from its level in 2003.
Cost of energy
The high cost of energy is one of the biggest bottlenecks to economic activity in the country (KIPPRA, 2005).
Kenya continues to lose out on foreign direct investments partly because of this problem, with considerable penalties on socio-economic development. Available data shows that the cost of electricity in Kenya is four times that of South Africa, the country’s main competitor in the region, and more than three times that of China (KIPPRA, 2005).
The current energy system is not