AG's office in the spot for hindering KenGen's cheaper power plan
Business
By
Brian Ngugi
| Feb 28, 2026
Daniel Kiptoo Bargoria, Director General, EPRA, during the launch of Proto Energy’s Sustainability Report. [Wilberforce Okwiri, Standard]
The energy regulator has revealed that rules allowing power producer Kenya Electricity Generating Company (KenGen) to sell electricity directly to factories at cheaper rates remain stuck at the Attorney General’s (AG) office.
This explains why the State-owned power generator remains captive to troubled Kenya Power despite a 2019 law ending the single-buyer model.
Energy and Petroleum Regulatory Authority (Epra) Director-General Daniel Kiptoo told The Standard in an exclusive interview that the draft Energy (Electricity Market, Bulk Supply and Open Access) Regulations 2023 have not been cleared for publication after the AG returned them with comments.
“The Epra prepared The Energy (Electricity Market, Bulk Supply and Open Access) Regulations 2023 and undertook stakeholder consultations and submitted them to the Cabinet Secretary for onward transmittal to the Office of the Attorney General for legal drafting and approval for publication,” Kiptoo said.
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“The draft regulations were also gazetted for public comments during the stakeholder consultation process. The regulations have, however, not been cleared by the Office of the Attorney General for the gazettement.”
Kiptoo explained that the AG had provided comments for the Authority to address before the rules could be cleared.
“The Attorney General provided comments to be addressed by the authority before they are cleared. The authority has addressed the comments raised by the AG and has resubmitted them for clearance,” he said.
The regulations would operationalise Section 131 of the Energy Act 2019, which paved the way for the gradual introduction of a Kenyan electricity market where generators and retailers can trade power directly.
“The provision of the Act makes way for the establishment of a marketplace to facilitate the trading of electricity between generators and retailers,” Mr Kiptoo said.
The Act also provides for the non-discriminatory provision for the use of an electric transmission or distribution system by any licensee or consumer, the Director-General noted.
“Establishment of a non-discriminating, efficient, and reliable System Operator having adequate financial and technical capacity to ensure security of supply facilitates the establishment of an electricity market and realisation of open access,” he added.
Kiptoo said Epra is actively pursuing clearance of the regulations.
“The authority is following up with the Cabinet Secretary for Energy and Petroleum and the Office of the Attorney General to have the regulations cleared for publication and implementation,” he said. For KenGen, which provides roughly two-thirds of Kenya’s electricity, the delay means it cannot bypass Kenya Power to sell to industrial consumers despite being ready to make that pivot. The generator confirmed its readiness in a previous interview, stating it would move once Epra issues proper guidelines. Under the proposed framework, industrial customers consuming one megavolt-ampere or more would source directly from generators, paying wheeling charges to use Kenya Power’s transmission lines. This would allow KenGen to capture higher-margin revenue from factories while reducing exposure to Kenya Power’s deteriorating finances.
The utility owed KenGen Sh16.65 billion as of June 2025, with payments currently averaging 113 days – nearly triple the agreed 40-day window. KenGen was forced to increase expected credit loss allowances, with provisions for Kenya Power arrears jumping 78 per cent to Sh830.99 million.
Total impairment provisions for unpaid bills reached Sh1.37 billion in the 2025 financial year.
Despite an aggressive diversification drive that has seen it secure regional consultancy work in Ethiopia and Djibouti, KenGen remains captive to its sole cash-strapped domestic customer until the regulations are cleared.
The Kenya Association of Manufacturers has championed the open access move, arguing that direct competition could lower industrial tariffs that currently hamper regional competitiveness.