Presented by; Eng. Joseph Njoroge, MBS, Managing Director & CEO,

Kenya Power

The Institution of Engineers of Kenya Conference, 9th to 10th May 2012

Reference to Energy in the Constitution of Kenya, 2010

Existing Power Sector Structure Kenya Power’s Business

Alignments to County Governments

Opportunities Challenges Conclusions

Constitution of Kenya, 2010: Reference to

Energy & Electricity

Constitution of Kenya, 2010: Reference to

Energy & Electricity

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Fourth Schedule, Part 1, clause 31: National Government does energy policy including electricity and gas reticulation and energy regulation

Fourth Schedule, Part 2, clause 8(e): County Governments do County Planning and development including electricity and gas reticulation and energy regulation

>>> Electricity is both a National and County resource

Article 6 (3) – Requires national state organs (Kenya Power included) to ensure reasonable access to their services in all parts of the Republic as appropriate having regard to the nature of the service

Article 46 – persons’ right of access to services offered by a public and private persons

Article 201 (2) – Limits use of Equalization fund (a National Govt facility) to provide basis services including Electricity to the marginalised

Article 62 – Public Land –Laws emanating from this definition will affect electricity generation, transmission and distribution

Articles 69, 70 & 71 – obligations in respect of environment, enforcement of environmental rights and agreements relating to natural resources

Existing Power Sector Existing Power Sector StructureStructure

KPLC’s business alignment with County GovtsKPLC’s business alignment with County Govts

Ministry of Energy

Ministry of Energy

ERCERC

Energy Tribunal

Energy Tribunal

KenGenKenGen

ImportsImports

IPPsIPPs

REAREA

GDC –steam resource development

GDC –steam resource development

KETRACO – Transmission KETRACO – Transmission

KPLC – Transmission/Distribution/Supply KPLC – Transmission/Distribution/Supply

CustomersCustomers

Off-gridGeneration

Institutions’ activities in the Scale up Exercise:Ministry of Energy

Facilitating the Kenya Electricity Expansion Project (KEEP) being implemented by MoE, Kenya Power, KenGen, REA, Ketraco, GDC & ERC

Kenya PowerMaximization projects in areas around the extended grid network to increase access Slum areas electrificationIncrease capacity, efficiency and quality of supplyPartial funding of projects under ESRPOperation of generation and supply of electricity in off-grid locations

Institutions’ activities in the Scale up Exercise:

Rural Electrification AuthorityExtending the MV grid to social amenities in the rural areasInvestment in off-grid generation

KETRACOProvides the transmission network to connect generation and distribution and between major load centres. REA and Kenya Power extends downstream

Transmit and distribute Electricity in Kenya

Has established 61 Branch centres to bring services to the people

All 47 counties have Branch Centres already set up

Opportunities & Challenges

Opportunities & Challenges

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Expanded role of the National Energy Regulatory Commission to policy development to guide Counties in developing Electricity services

Counties can undertake power generation projects to meet their electricity needs

Increased demand of electricity at 10% per annum due to: ◦ County Government – County Offices, urban centres,

Infrastructure development. ◦ Resulting increased access◦ Infrastructure development in Vision 2030

Vision 2030 envisages major infrastructural development to facilitate economic growth in the Medium Term Programs and railway automation. Kenya Power’s contribution is: Increasing population access to electricity from the

current 29% to 40% by 2020 Planning and implementation of distribution

reinforcement and upgrade projects Procurement of adequate power generation capacity from

diverse sources; and maintaining a minimum reserve margin of 15% (and preferably 30%)

Promotion of green energy investments by undertaking the procurement process

Improving power supply quality and reliability

Petroleum deposits discovery in Turkana could usher in a new frontier in Energy provision should the deposits be confirmed to be commercially viable.

Increased necessity to expand the transmission and distribution systems and continued maintenance to ensure quality of supply

Capacity development in each County to guide decisions related with Energy & Electricity

Different levels of endowment to natural resources related to electricity – need for policy framework for the same

Commitment towards energy efficiency & environmental issues

Capital outlay for electricity projects – The sector is capital intensive in nature

National Government’s role in provision of Investment guarantees for development of generation plants

Clear mandates of Sector players to ensure efficiency in resource utilization

Constitution of Kenya 2010 saw a new dawn for the Country and created enormous opportunities to achieve the gains envisioned in Vision 2030

Demand for electricity in Kenya has been growing steadily over the last 5 years with it rising by 9% in the year 2010/11. A medium term growth of between 10 & 12% is expected.

Access and customer service has been the key focus for Kenya Power in delivering the gains made by the Constitution

The challenges are easily overcome by consultative planning, clear mandates of every sector player, a robust National Regulatory Authority and National Government involvement.

Thank You Thank You

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