Kenya Electricity Generating Company (KenGen) is planning to sell electricity directly to consumers.
The state owned firm’s first clients will be flower firms and large industries in the proposed Naivasha Industrial Park.
“The flower firms and large industrial investors would be our first customers if the proposal is approved by the Energy and Petroleum Regulatory Authority (EPRA),” said Cyrus Karingithi, the KenGen assistant manager, resource development and infrastructure.
Currently, Kenya Power Plc, a losted electricity distributor has a monopoly on power sales but the Energy Act 2019 provides for the opening up of the sector.
Until now, KenGen has been restricted to electricity generation, alongside Independent Power Producers (IPPs).
Though KenGen is already healthy financially, analysts believe selling electricity directly would be a big boost for KenGen’s revenues.
Last month, the State offered investors a low power tariff of Sh5 per kilowatt-hour (kWh) to set up factories in Special Economic Zones (SEZ) in Olkaria, Naivasha, as the government takes steps to grow the manufacturing base and create more jobs.
The Energy and Petroleum Regulatory Authority (Epra) approved the sweetheart tariff deal for big factories that will set up base in the 9000 acres special zone in which more than 100 local and foreign investors have expressed interest in.
Market data shows the Sh5/kWh tariff is about half what is charged large-scale commercial consumers who pay between Sh10.10-12/kWh at peak hours.
Mr Karingithi said KenGen has recently diversified revenue streams on sale of geothermal steam to flower firms.
The Oserian Development Company has been using geothermal energy from KenGen to heat rose greenhouses — that have expanded to 50 hectares — since 2003.
Kenyan Business Feed is the top Kenyan Business Blog. We share news from Kenya and across the region. To contact us with any alert, please email us to [email protected]