Magiro Power is a small hydropower company located in Muranga County just to the north of the capital Nairobi in central Kenya.
The company is the brainchild of the young Kenyan entrepreneur John Magiro, who is on a mission to provide affordable, reliable and sustainable access to off-grid electricity with small hydropower plants. Magiro grew up in a small rural farming community without access to electricity. The nearest pole was 15km away and the national grid connection costs were beyond the means of most in the community. Seeing the struggles his family and others were undergoing, at the age of 18 years he decided to build a micro-hydropower plant in the Gondo river, drawing on everyday items including a dynamo and bicycle wheel rim.
The so-called Gitugu Hydropower Plant grew and around 2015-16, after having connected his first 75 customers, Magiro began to attract wider attention. With support from organisations such as WWF, Kenya’s National Environment Trust Fund (NETFUND) and Switch Africa, he was able to scale-up the plant from the initial 7.5kW and connect more customers by expanding what had become an 8km mini-grid.
In time, this led to the formation of a partnership with the Belgiumbased small to mid-size hydropower developer Hydrobox, with theirlocal branch Hydrobox Kenya. Through this he was able to upgrade the technology into a commercially viable plant with an installed capacity of 16kW. To date, Magiro is a 50% subsidiary of Hydrobox Kenya.
Between 2018 and 2019, Magiro also acquired two other nearby off-grid rural electrification hydro projects that had stalled; namely the Kiawambogo and Kahinduini projects. These currently have installed capacities of 18kW and 26kW respectively, with plans to upgrade the Kahinduini power plant to 60kW and the Kiawambogo power plant to 50kW during the course of 2021.
Magiro Power initially operated with a flat rate model whereby the consumers would pay a fixed monthly membership fee to maintain their connection to the Magiro Power grid. The model has evolved to a payment per kWh rate depending on consumption. The company is also transitioning to a prepaid payment model for low consumption households. For larger consumers such as businesses, which are in the process of being onboarded, a customised tariff is offered based on the load and the fees are post-paid.
On average, Magiro Power aims to be at least 23% more affordable than the national grid. Magiro Power is currently supplying 680 households and small businesses with access to reliable power within its 30km mini-grid. These households can now operate appliances both within the house and on their farms, making their lives easier and work more efficient.
Many of the farmers have acquired chaff cutters for preparation of feed for their livestock. Within the area, the presence of Magiro Power is palpable, with powered streetlights illuminating the road and the village centre, thereby enhancing security and allowing for extended trading activities after nightfall.
During 2020, Magiro Power spent time rolling out smart metering and improving remote monitoring of the power plants with their partner Yetu Smart Grids to enable better load management and remote management of the power plants and mini-grid.
An appliance leasing scheme has been introduced to enable customers to acquire otherwise unaffordable agricultural equipment and appliances, usually payable over a six-month period.
Additionally, Magiro has started working on other projects for the productive use of electricity to be implemented during 2021. These include charging stations for electric motorbikes and a containerised cooling station for agricultural produce to be offered on an ‘as a service’ basis. This will enable the company to be more financially sustainable by supplementing the income from the households.
To further support the scalability of the company, excess energy will be sold to the national utility.
The company has made a point of employing local youth and training them in areas such as marketing and customer care, to ensure that the customers’ needs are met and that technical issues are resolved in the shortest time possible. In addition, Magiro Power – in conjunction with Netfund and management trainers MDF Training & Consultancy – is working on implementing a project to empower women and youth entrepreneurship through marrying the productive use of electricity with business coaching and access to finance.
According to Magiro, the company was faced with challenges including reduced revenue collections in some months due to farmers’ low harvests and illegal electricity connections, with the latter prompting the uptake of metering and the prepaid revenue collection model.
Other challenges pertain to the lengthy licensing procedures for legalising the mini-grid operations.
For Magiro, electricity is the engine powering improved welfare and growth in rural Africa. And small hydropower is the most sustainable, efficient and affordable energy source – being easy to install on rivers and competitively priced.
“Small hydropower is a great solution to help Kenyans meet their growing energy demands,” he says. “Our objective is to make the transformative potential of electricity accessible to everyone.”