The Ministry of Energy has come up with new proposed reforms that are set to split Kenya Power’s dealing with commercial consumers.
In proposed reforms by the Ministry of Energy, Kenya Power will distribute electricity to only large commercial and industrial consumers to boost efficiency and cut costs while the Rural Electrification and Renewable Energy Corporation (Rerec) will take over the role of distributing electricity to household consumers.
“Reconfigure KPLC and Rerec across consumer segments so that KPLC is positioned to serve large commercial and industrial consumers, while Rerec is positioned to serve the social mandate for household consumers,” the reforms read.
Energy Principal Secretary Gordon Kihalangwa said the proposal is subject to public participation.
“We’re seeking stakeholders’ view on this matter after which we will develop a work plan and timelines of implementation. It is a work in progress,” he said.
The Energy and Regulatory Authority (Epra) also put up new regulations that aim to allow businesses to sign 10-year contracts with Kenya Power and inject it into the national power grid.
This will apply to businesses that use less than one megawatt (MW) but lack the capacity to store excess electricity.
Kenya Power has been given the ultimate mandate of choosing who sends extra solar energy to the national grid in proposed laws that highlight issues over unfair competition and conflict of interest by the utility corporation that is also chasing business in the fast-growing area.
“The licensee (Kenya Power) shall examine all applications in Regulation 7 within sixty (60) days and on a non-discriminatory basis,” the Epra regulations partly said.
Several enterprises and an increasing number of homes are converting to renewable electricity, particularly solar, in order to have a cheap and stable supply in the face of lowering solar plant installation prices.
The large move to solar power by heavy consumers has pushed Kenya Power into an even more difficult situation as a result of excess electricity output.
Kenya Power issued an alert in November 2020, stating that some of its industrial customers — who represent around 54.8 per cent of its sales income — are gradually transitioning to self-generated solar power, further straining the company’s already precarious finances.
Many businesses, institutions, and industries have switched to grid-connected solar photovoltaic (PV) systems to generate power for internal use, ensuring reliable supply and lowering operational expenses.
Solar power producers, according to the proposed guidelines, would sell the excess to the grid and also receive supply from the grid, particularly at night when their output is low.