Fuel Economy Improvements in Kenya – GFEI

Context of Transport Climate Action

The annual growth rate in Light Duty Vehicles (LDVs) in Kenya is 12%. The projection in total LDVs registration is expected to reach 5 million vehicles in 2030 and 8.7 million vehicles in 2050 up from the 2 million vehicles registration in 2012. The Global Fuel Economy Initiative (GFEI) project supported Kenya to carry out a vehicles inventory study to establish the country’s average fuel economy trends. The study showed that the fuel economy of vehicles imported into Kenya is getting worse: from an average of 7.4 L/100km with a corresponding CO2 emission of 178 g/km in 2010 to 7.7 L/100km, equivalent to a CO2 emission of 185 g/km in 2012.

At this rate, LDVs were estimated to emit a total of 717,000 tonnes of CO2 in 2012. The study also established that the composition of the new vehicles registered over the period 2010 to 2012 was 1%. This implies that 99% of the registered vehicles were imports of used vehicles. This calls for urgent policies to shift imports towards cleaner, more fuel efficient vehicles.

In 2015, the Kenya government instituted several measures aimed at reducing transport emissions and improving fuel economy. These include improvements in fuel quality and taxation based incentives towards newer more fuel economy vehicles.

Draft proposals on a feebate system, vehicle labeling mechanism and new vehicle purchase scheme are under development and near completion, and will be presented to the government early 2016.

Description

With support from the Global Fuel Economy Initiative[1] and the Energy Regulatory Commission, an inventory study of vehicles imported into the country during the period 2010 – 2012 was carried out by the University of Nairobi. The study assessed the trend in average fuel economy and CO2 emissions. The government committed to improving vehicle fuel economy during a media launch of the inventory report in April 2015. Subsequently, the government announced changes to the excise duty in the 2015 budget to encourage importation of newer vehicles with potential for lower emissions.

The country is currently being supported to develop concrete vehicle policies and strategies to encourage importation of more fuel economy vehicles including fiscal guidelines such as CO2-based taxation, consumer awareness schemes like mandatory vehicle labelling and new vehicle purchase schemes.

Funding is provided by the Global Environment Facility, European Commission and the UK Department for Internatioal Development, DFID.

[1] An international partnership between FIA Foundation, UNEP, International Energy Agency, ICCT, International Transport Forum and UC Davis

Implementation 

The GFEI together with the Energy Regulatory Commission (ERC) supported a vehicle inventory study to assess Kenya’s average fuel economy and trends in 2010-2012. This study builds on an earlier one that was carried out by the Climate XL for the period 2005 and 2008. The ERC formed a national multi-stakeholder team to implement the project. The findings of the study were presented to stakeholders in June 2014 and revised based on stakeholder reviews. A media launched was then carried out in April 2015 that saw the government committing to importation of more fuel economy vehicles.

At the same time, the government instituted several policies to reduce transport emissions and incentivize the import of fuel economy vehicles. The fuel standards were significantly improved, from a high of 10,000 parts per million (ppm) diesel fuels sulphur in 2010 to 50 ppm. The excise duty on imported vehicles was also amended, from a flat rate of 20% based on the value of the car to a differentiated rate for cars less than and those more than three years of age.

Further, towards the end of last year, UNEP entered into an agreement with the ERC to support concrete policies to encourage import of more fuel economy vehicles including fiscal measures and consumer promotional measures. These are almost completed and will be presented to stakeholders, including the government agencies responsible for vehicle importation early 2016.

Benefits

The expected benefits of the project are threefold: lower oil import bill for the government and oil consumption for the consumers; improved urban air quality; and reduced greenhouse gases.   ERC are proposing to develop a website that will monitor fuel economy progress.

Potential for scaling up

GFEI and ERC are providing advice and support about developing similar fuel economy policies to other governments in the East African region, including the need for harmonizing vehicle policies. As a result of Uganda has recently concluded their vehicle inventory study.

Selected references

Please indicate a few, preferably online, references (reports; websites; other supporting information)

www.erc.go.ke/.gfei

http://www.unep.org/transport/New/PCFV/africa/kenya_piea.asp

PROJECT INFORMATION

Location:

Nairobi: Kenya

Start:

2013

Finish:

2016

Tags:

Kenya, Mauritius, Mitigation, Passenger, Policy, Awareness, Partnerships, Finance

Organizer/s:

Global Fuel Economy Initiative (UNEP) and Energy Regulatory Commission of Kenya

Contact/s:

Jane Akumu, Transport Unit, UNEP Email: jane.akumu @unep.org

“We can achieve a doubling of the fuel economy of the global fleet with technologies commercially available today. So the cost is not so much in developing new high tech vehicles as in spreading and applying existing technologies.”
-Eng. Joseph Njoroge, Principal Secretary, Ministry of Energy and Petroleum