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Ministry of Energy White Paper

In late July 2022, the Ministry of Energy issued the Energy Sector White Paper which puts forward a transformational agenda for accelerating Kenya’s low-carbon transition ambitions while ensuring the delivery of power that is reliable and affordable to all. This is with the aim of leveraging green energy and to increase the installed capacity from 3 GW to 100 GW in 18 years, averaging to more than 5 GW a year. The funding will mainly be from global green capital for renewable energy projects, which directionally shifts energy mix away from high-carbon thermal generation.

The Paper articulates critical shifts that need to be made to bring about systemic change and unlock unprecedented growth in the energy sector. These include a 50% reduction in electricity bills from a current high of about 18 USD cents/kWh to at least 9 USD cents/kWh by 2040 and improving operational efficiencies in the sector by allocating large commercial consumers to Kenya Power with Rural Electrification and Renewable Energy Corporation (REREC) servicing smaller, mainly domestic, consumers.

Additionally, the White Paper proposes the increased utilization of the Time of Use tariff which would realize reduced costs of production for commercial industrial consumers who utilize electricity when it is more available cheaply during off-peak hours.

The White Paper is not a government policy document but an expert analysis requiring stakeholder input for completeness and concurrence. However, it presents viable proposals to engender reforms in the energy sector and improve the ease of doing business in the country. The improved ease of doing business in the country will help to attract investment in SEZs and industrial parks in the country.

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