The Energy and Petroleum Regulatory Authority (EPRA) of Kenya has published new regulations that once gazetted will allow independent power producers (IPPs) access to the electricity distribution market. The regulations will also allow private companies to import power from neighbouring countries.
The regulations outlined in the draft Energy (Electricity Market, Bulk Supply, and Open Access) Regulations 2024 will break the longstanding monopoly held by state-owned electricity utilities, Kenya Power and Kenya Electricity Transmission Company (KETRACO), in electricity supply.
These new regulations by East Africa’s leading economy will significantly liberalise its electricity market, a move the regulator says will increase competition, reduce electricity tariffs and boost service delivery to consumers.
Presently, IPPs are only allowed to sell power to the state-owned electricity utility Kenya Power and KETRACO. Kenya Power is also the only entity allowed to sign electricity import agreements with foreign electricity producers, and has deals with Ethiopia Electric Power and the Uganda Electricity Transmission Company Limited.
Commenting on the proposed regulations, Joseph Siror, the CEO of Kenya Power said; “We welcome the new regulations on the electricity market, bulk supply and open access as gazetted by the Energy and Petroleum Regulatory Authority (EPRA) last week.”
Establishing a competitive wheeling market in Kenya
The new reforms will also allow wheeling of electricity using the distribution and transmission network of Ketraco and Kenya Power, estimated at 4,660 kilometres and 310,618 kilometres respectively.
The regulations will allow for private energy companies opportunity to build, operate and maintain systems meant to generate electricity, approval to build, operate and maintain infrastructure meant for power transmission and a retail supply to sell, bill and collect revenue.
In the new regulations, EPRA will be reviewing and approving proposed tariffs for any service to be charged by licensees. The regulator says it is committed to ensure fair pricing in the market.
The regulations also establish the responsibilities of transmission and distribution licensees in maintaining their networks, and will enforce non-discriminatory access by other licensees and eligible consumers to privately developed distribution and transmission networks.
