Independent Power Producers (IPP) seeking to generate power exceeding 500 Kilowatts could soon be required to seek approval from the Energy Petroleum and Regulatory Authority (EPRA).
This is after a proposal by Leader of Majority Kimani Ichung’wah in the Statute Law (Miscellaneous Amendments) Bill 2023 tabled in parliament.
Currently, the law stipulates that any company or individual generating power beyond 1 Megawatt for private use should seek approval from EPRA.
But Ichung’wah in his proposal wants the limit of the maximum power companies can generate without the authorization lowered to 500 Kilowatts.
If approved, the proposal would see entities or individuals in the power generation business affected.
So far, companies including tea factories and cement manufacturers have already ventured into power production.
Besides using the self-generated power for their operations, the companies also sell the surplus to the Kenya Power and Lighting Company (KPLC) grids as independent producers.
IPPs have lately contributed significant power to the national grid used by the KPLC.
Growing Number of IPP Companies
In 2022, Kenya Power reported that IPP contributed 37% of the total power in the national grid.
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Of concern, however, has been the disparities between the cost of power supplied to KPLC by the IPPs and that generated by the state-owned Kenya Electricity Generating Company (KenGen)
Lack of a proper framework to govern the IPPs has been named as a leading factor causing transparency concerns.
Ichung’wah further proposed a review of EPRA functions said to be overlapping with the functions of the Ministry of Energy.
Additionally, the Bill tabled by Leader of Majority recommended a 100% increase of the levy charged on electricity and petroleum.
The increment, if passed, would see fuel and electricity charges in the country surge further.
“Delete the phrase “half of a (percent)” appearing in paragraph (a) (of Section 20(1) of the Act),” the Bill presented by Ichung’wah read.
What’s more the Kikuyu legislator proposed the inclusion of the Kenya Power and Lighting Company (KPLC) in the membership of the Rural Electrification and Renewable Energy Corporation.
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Other recommendations in the amendment bill include winding up the Nuclear Power and Energy Agency and transferring its functions to the Ministry of Energy.
EPRA’s role in the regulation of crude oil business is also set to be expanded with Bill.
