Kenya has a liberalised power sector, with unbundled generation, private producers, cost reflective tariffs, a single buyer and a sector regulator.
The main players are:
• The Ministry of Energy, which sets energy policy.
• The Energy & Petroleum Regulatory Authority (EPRA) was established in March 2019 as the successor to the Energy Regulatory Commission (ERC). It is the sector regulator, with responsibility for setting tariffs and oversight. The Energy & Petroleum Tribunal arbitrate disputes in the sector.
• Kenya Electricity Generating Company (KenGen), the country’s largest generation company, with 68% of installed capacity. It is 70% owned by the government, with the remaining shares listed on the Nairobi Stock Exchange.
• Kenya Power & Lighting Company (KPLC or Kenya Power), the single off-taker, which buys power from all the generators under Power Purchase Agreements (PPAs). It is listed on the Nairobi Stock Exchange and 50.1% state owned. It also owns and operates most of the existing transmission and distribution system in Kenya.
• Kenya Electricity Transmission Company (KETRACO), the entity responsible for planning, building, owning and operating new high voltage electricity transmission assets. It is also responsible for facilitating regional interconnections and is 100% state owned.
• Geothermal Development Company (GDC), a 100% state owned special purpose vehicle focused on geothermal activities.
• Rural Electrification & Renewable Energy Corporation (REREC), this body was created by the Energy Act 2019 to replace the Rural Electrification Authority (REA). The REREC has an expanded mandate with responsibility for Kenya’s rural electrification projects and the renewable energy programme.
• The Nuclear Power & Energy Agency, formerly the Kenya Nuclear Electricity Board (KNEB), is developing a legal and regulatory framework for a nuclear energy programme.
Kenya also has 15 Independent Power Producers (IPPs), which combined account for 29.8% of installed capacity. The largest IPPs are Orpower 4 and Iberafrica Power. There are also a number of private mini-grid developers, such as Powerhive, Powergen, and RVE-Sol, which generate and distribute power in off-grid areas. A growing number of Solar Home Systems companies including M-KOPA, Mobisol, BBOXX and Azuri are also operating in areas without grid access, rolling out Pay-As-You-Go services.
Source: Kenya Electricity Sector Investment Prospectus 2018 – 2022
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