Report on the Electrical Power Industry in Kenya
- The Trade Adviser
- Feb 2, 2024
- 1 min read
Updated: Jun 9
Overview
Kenya's electrical power sector has exhibited consistent growth over the past two decades. The country boasts abundant renewable energy resources, particularly geothermal power, making it one of the world's lowest-cost developers of geothermal energy. Efforts to enhance electricity accessibility have resulted in a substantial increase, with electricity access expanding from 32% in 2013 to 75% of households in 2022. Urban areas enjoy near-universal access at 100%, while rural areas have reached 65%. The national electrification strategy aims to achieve universal access at an acceptable service level by 2022.
However, the COVID-19 pandemic posed challenges to the sector, causing a decrease in power demand as companies scaled down operations and businesses struggled to survive. In response, the Government of Kenya (GOK) has sought to renegotiate power tariffs with Independent Power Producers (IPPs) to mitigate rising goods costs. Tax amendments have also eliminated exemptions for businesses in renewable energy, introducing a 14% VAT charge on supplies for power generation and solar equipment.
