Kenya has cleared the path for power producers to directly sell electricity to larger consumers, ignoring a World Bank’s warning against the push to end Kenya Power’s monopoly. The State has published the Energy (Electricity Market, Bulk Supply and Open Access) Regulations of 2026 that allow producers to rival Kenya Power. The regulations will allow producers with no existing power purchase agreements (PPAs) with Kenya Power to sell electricity to the big consumers, like commercial enterprises, industries and factories.The producers will apply to use the network of Kenya Power and the Kenya Electricity Transmission Company (Ketraco) to reach the large consumers while paying the two firms an access fee known as wheeling charges. The World Bank cautioned that allowing other firms to sell power in competition with the sole distributor will trigger a surge in electricity prices, which have risen the most among basic items over the past five years. The larger and moneyed customers pay more for a unit of electricity, allowing Kenya Power to use them in subsidising some domestic consumers.Consumers with load demands of 10MVA include factories or communities that house residential and commercial tenants with a high daily usage of power. The World Bank warns that the shift will expose Kenya Power to competition risks, crippling the Nairobi bourse-listed utility due to longterm wholesale electricity agreements it has inked with generators like KenGen, Lake Turkana Wind and OrPower4. Agreements for the direct sale of electricity will be for a period of between one and 10 years. The Energy and Petroleum Regulatory Authority (Epra) must approve the prices that the power producers will sell the electricity.Industries, factories and businesses bought 7,313 Gigawatt-hours (GWh) of power or 70 percent of the 10,570GWh that Kenya Power sold in the year ended June 2025. The utility firm’s electricity sales in the local market have steadily grown over the past few years to hit 11,330.84GWh in the year to June 2025 compared to 10,473GWh the previous year and 9,186GWh in the year ended June 2021. Opening up the electricity retail space will allow big consumers to enjoy an alternative supply of electricity away from Kenya Power, besides granting investors in the generation space a bigger market. For example, KenGen, which is the single-biggest supplier of electricity to Kenya Power, has for years sought to directly sell power to consumers.KenGen recently reiterated its intent to directly sell electricity to consumers as part of reducing the business risk triggered by the reliance on Kenya Power as the single off-taker. “What is pending are regulations of how that (direct sale of electricity to consumers) will be undertaken and how infrastructure will then be based on wheeling charges for using transmission lines. But we are certain that when the regulations by Epra are ready and proper guidelines are issued, that possibility will in the future be there,” KenGen said in a note to investors in February this year. KenGen is the single-biggest supplier of electricity to Kenya Power, accounting for 59 percent (8,482GWh) of the 14,472GWh that Kenya Power bought from producers in the year ended June 2025.But like other power producers contracted by Kenya Power, KenGen has been forced to endure delays in getting payments for the power supplied to the utility firm. The regulations, which were gazetted on May 8, look set to end years of monopoly that Kenya Power has enjoyed in the sale of electricity in Kenya, even as consumers grapple with supply hitches such as blackouts and unstable supply. Big consumers have for years decried unstable supply from Kenya Power and costly electricity, in what has prompted a number of them to seek back-up options like solar plants and biomass plants. Industries and commercial consumers of power pay a demand charge, making their unit price of electricity higher than that of domestic users. (ICE NAIROBI)

Fonte notizia: Business Daily