Kenya

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GH2 Country Portal – Kenya

Green Hydrogen Vision

Kenya produces more than 90% of its electricity from hydropower, geothermal energy, solar and wind energy as well as biomass. In this context as a leading African country in renewable energy with an abundance of the elements required to develop green hydrogen, it is well placed to acquire green hydrogen as an alternative energy source. This could enable Kenya to replace fossil fuels completely and thus create a new economic sector which keeps larger portions of the value creation chain in the country, leading to the generation of domestic jobs and economic growth. 

According to the upcoming hydrogen development program, the government is considering the entire green hydrogen value chain in terms of planning, transmission, generation and distribution of power not for individual use but also for economic activity as well.   

National Strategy

Kenya’s hydrogen development program is under progress. The Ministry of Energy is planning to produce green hydrogen using extra capacity in its grids, especially at night during low electricity demand in the short to medium term. 

Kenya is at present identifying industrial pathways to further pursue green hydrogen use as energy carrier for selected transport (mobility) options. In addition, the soon to be launched Hydrogen Development program will have insights to use hydrogen, methanol or ammonia as way to convey energy off-grid, green steel production, and the production of nitrogen content of fertilizers for existing and new regional industrial processes. 

The program will develop the green hydrogen market in Kenya, including a comprehensive policy and regulatory framework, pilot and research projects of different sizes, and building up expertise in Kenya through research, development innovation, and education. 

Capacity and Price

The targets have not yet been identified. 

Impact Targets

 

  • 100% use of clean energy by 2030. 
  • 100% access to clean cooking by 2028. 
  • Nationally determined contribution of reducing GHG emissions by 32% by 2030. 
  • According to the 10-point Corporate Commitment charter to climate change and sustainability in Kenya by representatives from the private sector in Kenya, there is a commitment to reduce greenhouse gas emissions by at least 5% per annum with a base of 2020. 

Policy Spotlight

While there are no laws or policies regulating the production, storage, and distribution of green hydrogen in Kenya at present, the existing general legal framework supports the adoption and utilisation of clean energy in the country. A few examples: 

  • Under the Value Added Tax in 2013, the importation of windmills is not subject to import duty or value-added tax (VAT) while hydraulic turbines and water wheels do not attract any import duty but 16% VAT. 

  • The Finance Act 2021 reinstated VAT exemptions on renewable energy equipment, such as solar and wind generation equipment, by scrapping the imposition of 14% VAT on the equipment which had been introduced by the Finance Act, 2020.  

Project Spotlight

  • KEPSA Project: The Kenya Private Sector Alliance (KEPSA) has signed a Memorandum of Understanding (MoU) with green energy company Fortescue Future Industries (FFI) to help facilitate its members participation in new large scale green energy projects in Kenya. Through KEPSA, FFI will engage with private sector players in seeking and taking advantage of supply chain and downstream green industrialisation opportunities through green industry advocacy and collaboration with public sector stakeholders to support rapid project mobilisation. 

  • A baseline Power-X study indicates by the Ministry of Energy of Kenya in partnership with the German Development Cooperation on the potential for green hydrogen in Kenya highlights that Kenya has potential to produce fertilizers and derivatives in the short to medium terms with pilot projects starting 2025. The Coast region, Rift Valley and wider Nairobi provide suitable location for successful green hydrogen production and markets. 

Government green hydrogen lead