(3 minutes read)
· Kenya’s Ministry of Energy will restrict Kenya Electricity Generating Company’s (KenGen) plans to sell power directly to consumers
· Kenya Power, a national entity has a monopoly on power sales. But the Energy Act 2019 has amended to provide for the opening up of the sector to competitors
· KenGen, contributes to over 70 per cent of electricity supply to Kenya Power
Kenya’s Ministry of Energy will restrict Kenya Electricity Generating Company’s (KenGen) plans to sell power directly to consumers. Kenya Power, a national entity has a monopoly on power sales. But the Energy Act 2019 has amended to provide for the opening up of the sector to competitors.
KenGen initially planned to begin direct sales as soon as regulations were ready to enforce the Energy Act, thereby ending the decades long electricity distribution monopoly held by Kenya Power. However, Energy Principal Secretary Joseph Njoroge said recently that the regulations would not give KenGen an unrestrained right to the sale of power. This will shield Kenya Power from loss of business.
The principal secretary said that while drawing up the regulations, there would be safeguards for Kenya Power from losing some of the customers who might be useful in taking up demand of electricity that Kenya Power has already committed to purchase from other independent power producers. It is to be seen how these regulations would be drawn up.
KenGen, contributes to over 70 per cent of electricity supply to Kenya Power. It is the -the single off-taker and has been restricted to electricity generation, alongside Independent Power Producers. But the company is keen to carry out direct sales, especially to industries near its plants. KenGen targets large customers which account for over half of Kenya Power’s electricity sales revenues. This could pose a future challenge for Kenya Power now facing huge financial constraints. Kenya Power sunk into a net loss of Sh939 million in the year ended June 2020, which is incidentally the first time after 18 years.
