Regulatory Framework

Institutional Framework

The power sector reforms which started in 1996 have seen a complete re-organisation of functions hitherto concentrated in the Ministry of Energy and the Kenya Power and Lighting Company Limited. This was a result of the need to place responsibilities to specific institutions that would specialize in the mandates vested in them under the Energy Act, 2006 to enhance efficiency. Accordingly, these were unbundled into generation, transmission, distribution, oversight and policy functions. The institutional structure in the electricity sub-sector in Kenya comprise the Ministry of Energy and Petroleum (MoEP), Energy Regulatory Commission (ERC), Kenya Electricity Generating Company (KenGen), – Kenya Power the Rural Electrification Authority (REA), Kenya Electricity Transmission Company (KETRACO), Geothermal Development Company (GDC) and Independent Power Producers (IPPs).

  • Ministry of Energy and Petroleum (MoEP)
  • Energy Regulatory Commission (ERC)
  • The Energy Tribunal
  • Rural Electrification Authority (REA)
  • Kenya Electricity Generating Company (KenGen)
  • Independent Power Producers (IPPs)
  • Kenya Power and Lighting Company (KPLC)
  • Geothermal Development Company (GDC)
  • Kenya Electricity Transmission Company (KETRACO)
  • Private Distribution Companies

Other Agencies in Energy Licencing

The agencies that provide licenses and/or clearances for energy related projects include:

 

 

Policies & Regulations

  • Energy Act, 2006:
  • The Energy Bill, 2015:
  • National Energy & Petroleum Policy, Final Draft:
  • Energy Policy 2004:
  • Feed-in Tariff Policy:

Licensing Flow-Chart for Electrical Renewables

The type and number of clearances required depend on the technology option and capacity of the project. Clearance is used in this context as a collective term referring to permits, licences, approvals, agreements and payments. All project developers will have to operate through a registered company (local or abroad) and have access to land (through purchase or lease).

 

Registration of companies http://www.statelaw.go.ke and land acquisition procedures www.lands.go.ke are not featured on this RE portal.

 

These requirements apply to all grid-connected projects and commercial off-grid projects.

The water abstraction permit, Kenya Civil Aviation clearance, geothermal resource licence (concession) and the geothermal exploration licence applies only to hydro, wind and geothermal projects respectively.

 

Project with capacities covered within the Feed-in Tariff (FIT) policy will have the power purchase agreement (PPA) negotiated under the policy while those outside the will be negotiated under a capacity based power purchase agreement (PPA).

Off-grid commercial projects are not required to negotiate a PPA with the government utility.

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