The monopoly currently being enjoyed by Kenya’s power distribution company, Kenya Power, will soon be a thing of the past as the country’s energy regulator, the Energy and Petroleum Regulatory Authority (EPRA), has developed regulations that will open up the electricity market and allow private sector investors to participate in the distribution of electricity.
Kenya Power has enjoyed a monopoly for several decades, spanning from 1922 when the company was incorporated as the East African Power and Lighting Company Limited to serve Kenya, Uganda and Tanzania.
Its name changed to the Kenya Power and Lighting Company Limited in 1983.
Kenya Power is partly owned by the Government of Kenya, with 50.1 per cent shareholding and private investors with 49.9 per cent shareholding.
A report by Kenya Star, a local news portal, said the regulations were developed following a petition by Independent Power Producers (IPPs) to allow open access to power transmission and distribution.
The draft Energy (Electricity Market, Bulk Supply and Open Access) Regulations, 2024, will, upon gazette, apply to the generation, importation, exportation, transmission, distribution and retail supply of electrical energy.
The Director General of EPRA who spoke at a public participation workshop recently explained that the investors would be at liberty to participate in power generation, transmission and distribution infrastructure business enabling them to supply bulk electricity to private retail vendors who would, in turn, oversee last-mile connectivity and billing to consumers.
He added that the open access principle is a step forward in modernising the electricity market and promoting competition.
“It introduces the wheeling of electricity which holds the potential to unlock new investment opportunities, enhance grid reliability, and ultimately deliver greater value to consumers who can enjoy lower power bills, less frequent outages and more choices on electricity suppliers,” he said as quoted by the Star.
The regulator would promote fair pricing by reviewing and approving proposed tariffs for any service to be charged by licensees.
This includes tariffs to be applied by generators, retailers, network service charges, wheeling charges, use of system charges, and ancillary services charges.
The regulations further highlight how the structure and design of the electricity market would be developed and the different roles of different licensees in the sector.
They also establish the responsibilities of transmission and distribution licensees in maintaining their networks and providing non-discriminatory access to other licensees and eligible consumers.
Source: https://energynewsafrica.com
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