The Kenyan government, through the Energy and Petroleum Regulatory Authority (EPRA), has gazetted the Energy (Electricity Market, Bulk Supply, and Open Access) Regulations, 2024 (Gazette Notice 2512 of 2024). These regulations are designed to overhaul the power sector by moving from a single-buyer model (monopoly) to a competitive, multi-buyer, multi-seller market.
- • End of Monopoly: Independent Power Producers (IPPs) are now permitted to sell electricity directly to large-scale consumers, bypassing Kenya Power (KPLC).
- • Open Access Framework: The regulations introduce a "wheeling" framework, which forces transmission and distribution companies (such as KETRACO) to allow other producers to use their lines to deliver power, upon payment of fees.
- • Market Structure: The electricity market is divided into wholesale (generator to retailer) and retail markets, with EPRA overseeing licensing and monitoring to ensure grid stability and fair competition.
- • Goal of the Reforms: The regulations aim to reduce electricity costs, increase reliability, reduce outages, and encourage investments in renewable energy through competitive, transparent pricing.
- • Timeline: While the regulations were published in 2024, the government indicated that power producers would be allowed to start selling directly to consumers by the first quarter of 2025.
- • Dispute Resolution: In a significant shift, disputes in the sector will be referred to the regulator, EPRA, rather than the Ministry of Energy, aiming to enhance neutrality and efficiency.
- These measures are part of a broader, ongoing initiative to reform the energy sector and tackle high electricity prices, with additional regulations, such as those regarding energy reliability and quality of supply, also being developed.
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