Kenya: Lamu Coal-Fired Power Plant

A majority of communities in Lamu still depend on nature-based livelihoods such as
fishing, mangrove cutting, hunting and gathering, pastoral livestock keeping, farming,
eco-tourism and many others

If constructed, the 1,050 megawatt coal-fired power plant planned for the Lamu coastline will be the first coal plant in Kenya and the biggest in East Africa.

Local communities face devastating impacts on their health, food security, environment, cultural heritage, and livelihoods from the construction and operation of the coal plant.

Lamu County is internationally-recognized for the richness of its environment, including its marshlands, grasslands, savannahs, baobab and mangrove forests, coral reefs, beaches, and sand dunes.

The proposed 975-acre coal plant site is on the Lamu mainland, adjacent to vitally important coastal mangrove forests that protect against erosion and flooding and serve as a breeding ground and nursery habitat for various fisheries. The construction of a coal plant will destroy mangroves and require dredging the seafloor. Operation of the plant will continue the devastation. The coal plant’s cooling system will pull in huge amounts of seawater from Manda Bay, trapping marine life in the intake process. Water will be returned by this system into Manda Bay, desalinated and at a higher temperature, inflicting further damage on the delicate marine environment.

The land for the coal plant site is being compulsorily acquired from local farmers, who, years after displacement was announced, continue to face uncertainties around the extent and type of compensation and resettlement support they will receive. At least 109 farmers and their families have already been displaced by the construction of the site access road, without any consultation or compensation. Thousands of other land users, fisherpeople, and tourism operators, including indigenous and other vulnerable communities, are expected to lose their livelihoods.

“At my homestead, cashew nut trees were cut down for the road, while I was away. My farm, the road cuts down the middle of it. I wasn’t around. It was off-season. … They came with machines. They came here and destroyed our trees. I wasn’t consulted at all. To date, I have not been informed of anything at all. No sort of communications. Here we are. This has left me wondering, are we baboons, animals, or are we humans? It would even be better to be an animal than to be treated like this.” – A Kwasasi farmer displaced by the site access road

The unique cultural heritage of Lamu Old Town, which is recognized by UNESCO as a
World Heritage Site, faces existential threats from the proposed Lamu coal plant

The proposed site for the coal plant is approximately 20 km north of Lamu Old Town, a UNESCO World Heritage Site, recognized as the oldest and best-preserved Swahili settlement in East Africa. It is a small, conservative, and preserved society, maintaining its traditional architecture and its distinct social, cultural, and religious functions up to the present day. This distinct culture faces major threats from population and development pressures, loss of traditional livelihoods and environmental degradation. UNESCO itself has called for the end of the project, due to negative impacts on the World Heritage site.

Lamu is also home to many indigenous communities who have carved out distinctive livelihoods over the centuries utilizing the rich and diverse marine, coastal, forest, and grassland environments of the archipelago. These communities face displacement from the project site, adverse impacts on their livelihoods and cultural heritage, and loss of access to traditional land and resources in and around the project site. Impacts from the coal plant will exacerbate losses already suffered as a result of other LAPSSET developments, including the Lamu port.

Like all other coal plants, the Lamu coal plant will emit many chemicals and particulates that are linked to severe health and environmental impacts. In addition to the human and environmental toll, the delicate coal stone buildings found in Lamu Old Town, and elsewhere in Lamu, will be particularly vulnerable to acid rain and other air pollution caused by the coal plant. Toxic ash waste will be stored in a dry ash yard, where communities fear it will be at risk of catastrophic destabilization during monsoon season.

Serious doubts also remain about the necessity and economic viability of this project, which will lock the country into a 25-year power purchase agreement, forcing Kenyan electricity consumers to pay more than $9 billion even if the coal plant does not generate any power.

“There is … a potential of not only marginalizing the community but total disruption of a tradition and all sustaining traditional lifestyle developed and nurtured over millennia with the attendant loss of their heritage.” – Heritage Impact Assessment, cited by UNESCO

Despite the significant risks, project developers have not consulted threatened communities and have ignored their concerns for years. Information provided in the few community meetings that were held was superficial, inaccessible, inaccurate and unbalanced. Subsequent project documents failed to genuinely respond to any of the comments and concerns that were expressed during those earlier community meetings. On June 26, 2019, the National Environment Tribunal (NET) of Kenya agreed, invalidating the coal plant’s environmental license for lack of effective public participation, among other reasons: “It is presumptuous for a proponent, like the [Amu Power] did in this case, to proceed with the EIA study, identify the impacts and then unilaterally provide for mitigation measures in complete disregard of the people of Lamu and their views. We therefore find that public participation…was non- existent and in violation of the law.”

Chairman of Save Lamu (Credit: Desiree Knoppes)

Some affected groups, including the farmers displaced by the site access road, were not consulted at all. And shockingly, a pattern of intimidation by government officials has impeded attempts by local groups to hold information sessions to engage and discuss project impacts as a community.

Communities are now taking action to raise their concerns to the investors in the coal plant, including the World Bank Group’s International Finance Corporation (IFC). On 26 April 2019, two community groups, Save Lamu and the Kwasasi Mvunjeni Farmers Self-Help Group, filed a complaint (also available in Kiswahili) to the IFC’s accountability office, the Compliance Advisor Ombudsman (CAO), to voice their concerns about serious violations of the IFC’s Performance Standards in the development of the proposed coal plant.  Despite pledging to avoid new investments in coal projects, the complaint described IFC contributions to the coal plant project through through three financial sector clients: the Co-operative Bank of Kenya, FirstRand Bank, and Kenya Commercial Bank. Each of these banks provided loans to Centum Investment, one of the coal plant’s developers, after receiving IFC funds. The complaint was filed with support from Accountability Counsel and Natural Justice.

The complainants requested that the CAO conduct an investigation into the potentially disastrous project. In July 2019, however, the CAO found the complaint ineligible, determining that the links to the IFC did not constitute active, material exposure to the project. The decision was especially disappointing in that it confirmed a pattern of IFC support for the project, such that the complaint may have been eligible had it been filed at an earlier point in time.  The lack of transparency regarding the IFC’s financial intermediary links to problem projects, like the Lamu coal plant, make it difficult, if not impossible, for complainants to know in advance whether such complaints will be eligible.

“It is problematic for the IFC to be found investing in financial intermediaries that are funding the Lamu coal plant project, especially given that the World Bank has pledged to divest from coal. It is very clear that the anticipated impacts from the project threaten the human rights of the communities living in the region and their environment.” – Rose Birgen, Senior Program Officer at Natural Justice

While activists awaited the results of the complaint filed with the National Environmental Tribunal (NET) of Kenya, they continued to put pressure on the Industrial and Commercial Bank of China (ICBC), one of the largest investors in the Lamu project. Activists went to the bank’s investors to persuade them to pull out of the project. They posted messages on the bank’s social media channels and wrote letters to raise awareness amongst the public. In June 2019, activists protested at the Chinese embassy in Nairobi at the ICBC office. In response, the ICBC stated that only the Kenyan government can stop the project. However, in a victory for the civil activists, the ICBC ultimately completely withdrew from the project in November 2019. Following the ICBC’s withdrawal from the project, the Kenyan government has made statements suggesting it may not move forward with the project.

History

Businessmen, fishermen and farmers in Old Town, Lamu Island

In September 2014, the government awarded the contract for the coal plant to Amu Power, a special-purpose vehicle established by Gulf Energy, a privately held Kenyan energy company, and Centum Investment, a publicly traded Kenyan investment firm.

According to an Environmental and Social Impact Assessment dated July 2016, the coal plant will include three supercritical coal-fired thermal generating units. (Despite US multinational General Electric’s May 2018 announcement that it would be providing ultra-supercritical technology to the Lamu coal plant, no updated technical assessments have been published.) The power plant will burn about 2.8 megatons (Mt) of coal per year. The facility will operate 24 hours per day, seven days per week. The coal plant will also require the following infrastructure:

• Limestone mining at Witu. A 2,000-acre mining concession has already been approved by local authorities. Limestone is needed for a pollution control system called wet flue gas desulfurization. The limestone will be transported by land and sea to the power plant;
• A coal receiving system including a coal berth at Lamu port, coal handling equipment and a conveyor system approximately 15 km long to transport coal from the port to stockyards;
• Two coal stockyards, with capacity for up to 420,000 metric tons of coal;
• A 400 kV substation;
• A permanent workers’ colony accommodating 250-300 persons;
• A new rail system to transport coal if Kenyan coal becomes available; and
• Associated roads, buildings and other structures.

Construction of the coal plant itself is yet to begin, although development of the site access road – and associated displacement of Kwasasi farmers – is underway. The project was stalled for many years after Save Lamu and other Lamu residents appealed the granting of the environmental licence to the project at Kenya’s National Environment Tribunal.

The first three berths of the Lamu deep sea port under construction

The proposed Lamu coal plant and its impacts can only be fully understood in the context of the LAPSSET Corridor mega-project, described by the Kenyan government as East Africa’s largest and most ambitious infrastructure project. Major components of LAPSSET to be located in Lamu include:

• A 32-berth deep sea port;
• An industrial facility near the port, including oil-refining and petrochemical factories;
• Railway, road, and highway networks connecting South Sudan and Ethiopia to the port in Lamu;
• Lamu-Lokichar crude and product oil pipelines;
• A resort city and a new airport ;
• A new Lamu metropolis on the mainland, expected to host one million residents by 2030;
• All the necessary support infrastructure for metropolis development.

These projects are closely intertwined. The LAPSSET Corridor Development Authority is the entity acquiring the land on which the Lamu coal plant is proposed to be built.

The early stages of the port construction have already required significant mangrove clearance, dredging and reclamation of land. In 2018, in litigation filed by Lamu residents including members of Save Lamu, the High Court of Kenya awarded 1.7 billion KSh as compensation to 4,700 fisherpeople affected by the Lamu port development, in recognition of failures to respect their traditional rights. The piecemeal assessment of LAPSSET-related projects has failed to fully recognize the social and environmental impacts of LAPSSET as a whole. Directly as a result of the likely negative impacts on Lamu Old Town, a World Heritage Site, UNESCO has repeatedly requested that construction of various LAPSSET-related projects be halted “in order to allow time for a full assessment of its wider direct and indirect impacts on the property and for appropriate mitigation measures to be defined and implemented.” That cumulative impact assessment is yet to be undertaken.

“We, the community of Lamu, rely on our natural resources to survive – for nourishment, shelter, healthcare, to worship in our sacred spaces, and to continue our cultural traditions. Our environment is our wealth – when our environment is healthy, we are healthy. When our environment suffers, we suffer.”

After the success of pressuring the ICBC and its investors to withdraw from the project, together with Save Lamu, the Kwasasi Mvunjeni Farmers Self-Help Group, Natural Justice and other partners, our focus remains to continue to pressure investors and other key stakeholders to divest from this harmful project.

Initial Steps

Kwasasi farmers displaced by the site access road

At an earlier stage, the African Development Bank (AfDB) was considering providing a partial risk guarantee covering Kenya Power and Lighting Company’s obligations under a 25-year Power Purchase Agreement related to the coal plant. However, following advocacy by Save Lamu and others highlighting deficiencies in the project’s environmental and social impact assessments, that support has not yet been approved and further discussions appear to have been postponed.

In contrast to this community victory, members of Save Lamu and the Kwasasi Mvunjeni Farmers Self-Help Group have tried for years to raise their concerns with other project stakeholders and relevant government authorities, with no success. In stakeholder consultation meetings, questions were not answered or were answered dismissively, with misleading information. In addition, complainants have provided comments in writing, directly to Amu Power, its shareholders (Gulf Energy and Centum), its investors (including the IFC) and relevant government authorities, and indirectly through official consultation processes. Despite these good faith attempts to engage, they have never received a substantive, detailed response to their concerns. Instead, a pattern of intimidation by government officials has impeded attempts by local groups to hold information sessions to engage and discuss project impacts as a community.

The Complaint

Because of the lack of responsiveness of project developers, communities are also raising their concerns directly with the project investors. While many details of the project financing remain hidden from the public, the complaint described probable IFC contributions to the Lamu coal plant through three clients: the Kenya Commercial Bank, the Co-Operative Bank of Kenya and the FirstRand Bank. After receiving funds from the IFC, those banks provided financial support to Centum Investment, a co-developer of the coal plant.

On 26 April 2019, Save Lamu and the Kwasasi Mvunjeni Farmers Self-Help Group, with support from Accountability Counsel and Natural Justice, filed the complaint to voice concerns about serious violations of the IFC’s Performance Standards in the development of the proposed coal plant.

Fishing boats in Lamu

The 88-page complaint details a vast number of violations of those standards, including that:

• The environmental and social impact assessments fail to analyze critical aspects of the project.
• Affected people were not adequately identified or consulted.
• Thousands of farmers, pastoralists and other land users, fisherpeople, and tourism operators,  including indigenous and other vulnerable communities, are expected to be displaced, with no comprehensive resettlement or compensation plans in place.
• Pollution and biodiversity impacts have not been properly assessed or mitigated.
• The risks posed by this project to Lamu’s unique cultural heritage have been grossly underestimated.
• No real consideration has been given to other, less-polluting, energy sources or to alternative project sites.
• There has been no genuine assessment of cumulative impacts, despite the fact that Lamu is a central node along the planned LAPSSET Corridor.
• There is no broad community support for this project.

A more detailed summary of the complaint is available in English and Kiswahili.

“We have plenty of renewable sources of energy in Lamu; we see the sun for 12 months. Kenya can make use of these sources to produce energy without harming our environment, the resources we depend for our livelihoods, not even our health,” – Khadija Shekuwe, Coordinator of Save Lamu

The complaint requested that the CAO independently investigates the coal plant’s compliance with the IFC’s standards – a process known as compliance review. In July 2019, however, the CAO found the complaint ineligible, determining that the links to the IFC did not constitute active, material exposure to the project. The decision was especially disappointing in that it confirmed a pattern of IFC support for the project, such that the complaint may have been eligible had it been filed at an earlier point in time.  The lack of transparency regarding the IFC’s financial intermediary links to problem projects, like the Lamu coal plant, make it difficult, if not impossible, for complainants to know in advance whether such complaints will be eligible.

Together with Save Lamu, the Kwasasi Mvunjeni Farmers Self-Help Group, Natural Justice and other partners, we will continue to pressure investors and other key stakeholders to divest from this harmful project.

Case Partners

Save Lamu: a Kenya-based umbrella organization that represents over 40 organizations from Lamu, Kenya. Save Lamu’s mission is “to engage communities and stakeholders so as to ensure participatory decision-making, achieve sustainable and responsible development and preserve the environmental, social and cultural integrity of the Lamu community.”

Kwasasi Mvunjeni Farmers Self-Help Group: a group of farmers whose farms were destroyed because of the construction of the access road linking Lamu Port to Kwasasi, to provide site access to the proposed Lamu coal plant. To date, the farmers have not been consulted or compensated regarding these impacts. The Group formed in 2017 in order to seek accountability and remedy for this harm.

Natural Justice

deCOALonize

Friends of the Earth

Inclusive Development International

Environmental Law Alliance Worldwide (ELAW)

Sierra Club