Electricity in Kenya
Electricity is one thing that most Kenyans can attest to that has made significant progress in the country. In as much as the country has been making substantial progress in economic, social, and human development over the past few decades, Kenya has topped the list on energy sector, beating her neighbouring countries with a wide margin, at over 75 percent access currently (63.8 percent by 2017), the country’s rate was almost triple Uganda’s 22 percent and almost double Tanzania’s 32.8 percent and Rwanda’s 34.1 percent. In East Africa, Kenya now has the highest electricity access rate both from grid and off-grid solutions, according to the recent Multi-Tier Framework Energy Access Survey Report.
Despite all these progress, there are still a lot of people, about 18 million, who do not have access to electricity, in response to these on December 2018, the government launched the Kenya National Electrification Strategy (KNES) – a roadmap for achieving universal access to electricity by the year 2022.
With the help of geospatial technology, the strategy has identified least-cost options for bringing electricity to homes, businesses and public facilities. In addition to grid extension and intensification, it recognizes the important role the private sector will have to play in off-grid solutions, both mini-grids and standalone solar systems.
The ambitious Kenya National Electrification strategy aims to have every household connected to power through grid expansions and use of off-grid sources by 2022 in a subdidised plan where homes get subsidy to pay Sh15,000 gradually as they consume the electricity.
“In recent years, pronounced progress in expanding access to electricity was made in several countries, notably India, Bangladesh, and Kenya. Among the 20 countries with the largest populations lacking access to electricity, India, Bangladesh, Kenya, and Myanmar made the most significant progress since 2010,” says the World Banks Energy Progress Report 2019.
The world bank is committed in helping Kenya provide electricity to her rural population in order to achieve this by 2022.
Lucio Monari, Director for Energy and Energy Extractives at the World Bank said, “Its efforts to expand and improve access to electricity will impact millions of lives for generations to come. The World Bank will continue to support the Government of Kenya in its ambitious plans to achieve universal access by 2022.”
Background of electricity in Kenya
Well, most of us if not all must have sought information on how Kenya Power came to existence. Well, here a detailed well dug history.
Before 1997, Kenya Power and Lighting Company Limited (KPLC) was charged with the
generation, transmission and distribution of electricity in Kenya. In other words, it was a
classic state-owned vertically integrated utility that had not yet embarked on the steps
typical of a reform process.
Potential reform steps designed to improve power sector performance included:
a. Reduction/elimination of direct government control over electric utility organisations
b. Functional unbundling of existing organisations
c. Corporatisation and commercialisation of the resulting organisations
d. Independent regulation of monopoly functions
e. Free markets for competitive functions
f. Establishing conditions to attract private investment
g. Rationalisation of tariffs
i. Open access transmission
In 1997, the functions of generation were split from transmission and distribution. The
Kenya Power Company, which had been under the management of KPLC since 1954,
became a separate entity responsible for public-funded power generation projects. In 1998,
the Kenya Power Company was re-launched as the Kenya Electricity Generating Company
(KenGen). This separation of generation from transmission and distribution functions was
an initial step in the reform process.
The next major reform legislation was Kenya’s Energy Act No. 12 of 2006, which repealed
the Electric Power Act, No. 11 of 1997 and established the Energy Regulatory Commission
(ERC) to replace the Electric Power Act’s Electricity Regulatory Board (ERB), and also
established the Rural Electrification Authority (REA) and the Energy Tribunal.
The Energy Act has many reform-oriented provisions. Among others, it makes ERC an
independent regulatory body, because its Commissioners cannot be removed from office
before the expiration of their (staggered) terms except for good cause. This minimises the
potential for governmental interference with the ERC. It also mandates that contracts for
bulk supply of electrical energy shall be just and reasonable, which specifically means a rate
that enables the licensee to maintain its financial integrity, attract capital, operate
efficiently, and fully compensate investors for the risks assumed.
Using the power conferred by the Energy Act in 2012, the Minister for Energy made the
Energy (Electricity Licensing) Regulations, 2012. Though a step forward in licensing and
permitting, the Regulations are not reform-oriented. Significant disaggregation of Kenya’s
power sector from the former Kenya Power and Lighting Company (KPLC) began in 1997
when the functions of generation were split from transmission and distribution and (in
1998) re-launched as the Kenya Electricity Generating Company (KenGen).
Since then other power sector organisations have been spun off from KPLC or founded by the Government of Kenya, including the Rural Electrification Authority (REA), the Kenya Electricity Transmission Company (KETRACO), and the Geothermal Development Company. KPLC was rebranded to
Kenya Power Company in 2011. All of these organisations are wholly or partly owned by the
Government of Kenya.
The Kenya Electricity Grid Code, developed in 2008, was a very comprehensive document
that covered the regulations required for electric transmission and distribution network
technical requirements as well as planning procedures, tariff methodologies and internal
regulations of the ERC. This approach of including technical and commercial information for
both the transmission and distribution networks would complicate the amendment and
maintenance of such a document. Therefore, the decision was made to develop separate
grid code documents for the electric transmission and distribution networks.
Structure of the Kenya electricity power sector
The main power sector organisations include those listed below.
- Ministry of Energy and Petroleum: The Ministry of Energy and Petroleum (MoEP) is
responsible for formulation and articulation of energy policies through which it
provides an enabling environment for all stakeholders. Its tasks include national
energy planning, training of manpower and mobilisation of financial resources.
- Energy Regulatory Commission: The Energy Act established the Energy Regulatory
Commission (ERC) to replace the Electric Power Act’s Electricity Regulatory Board
(ERB). The functions of the ERC are to regulate importation, exportation, generation,
transmission, distribution, supply and use of electrical energy, and production,
distribution, supply and use of renewable and other forms of energy.
- Its functions also include tariff setting, review, licensing, enforcement, dispute settlement and
approval of power purchase and network service contracts. The ERC has all powers
necessary to expedient for the performance of its functions under the Energy Act.
- Energy Tribunal: The Energy Tribunal is a quasi-judicial body which was established
under section 108 of the Energy Act. It came into operation in July 2007 primarily to
hear appeals against the decisions of the ERC. It also has jurisdiction to hear and
determine all matters referred to it relating to the energy sector.
- Rural Electrification Authority: The Rural Electrification Authority was established
under Section 66 of the Energy Act as a body corporate. The REA was created in
order to accelerate the pace of rural electrification in the country, a function which
was previously undertaken by the Mi