- The more customers understand their access to electricity issues, the more targeted the complaints are, and the more likely it is for the sector to isolate and solve inefficiencies.
- Very few Kenyans access the Kenya Gazette regularly and those who do, have to weave through other non-electricity matters to reach the desired information.
The Kenyan electricity sector is now mired in a state of the unknown with customers and investors alike trying to figure out what next.
These groupings are looking to find out when and how the cost of electricity can be reduced, and when they will see new power plants, transmission lines and new business models like wheeling and net metering coming on board.
There seems to be a general state of unawareness of how things will evolve going forward.
There is also a suspicion that there is a hidden hand in every transaction, decision, and indecision.
Investors are unsure of when and exactly how to put money in the sector and the timelines of delivery.
This leads to higher perceptions of risk and resulting underinvestment or higher return requirements and higher costs of electricity.
But does it need to be this way? Is there a benefit to living in speculation and secrecy? No, it doesn’t and no, there isn’t.
The availability of information that is public and can be perused and analysed is good for the entire sector.
Customers can plan for their electricity-related expenses, utility performance can be better monitored, investors can make investment decisions and all of us can together check that the inefficient parts of our electricity sector are identified, and necessary effort and corrective action is directed there.
The opaqueness permeates some crucial areas including customer connection, billing, issue resolution process and timelines; the planning for new generation plants; acquisition of new powerplants; and utilities performance.
Visibility in these areas is important as they allow the economy to give comfort to consumers looking to do more productive use; utility management looking to serve customers better and be understood when there are issues; and investors working to build a business as they support electrification.
Customers in Kenya continue to feel mistreated, unheard, and ill-informed of the goings-on of the electricity sector.
This may be true or a misunderstanding due to a lack of information.
They apply and pay for new connections but still suffer the bureaucracy of getting the connection.
Wouldn’t we benefit from a searchable database of when applications were made whether the utility is sticking to the timeline to deliver a connection and where good reason exists, the reason for deviation?
This information is already available and can be anonymized for data protection reasons before being availed publicly.
The same can be said for the resolution of issues with connections and information on the breakdown of the bill.
The move to have two blocks for the bill instead of the full breakdown showing where the money spent on units goes has justifiably irked Kenyans.
Yes, with additional effort, you can access the full breakdown but why add the additional step and complexity?
The more customers understand their access to electricity issues, the more targeted the complaints are, and the more likely it is for the sector to isolate and solve inefficiencies.
Planning for new generation projects has been over the years a centralised process undertaken through the Least Cost Power Development Plan, the LCPDP.
For power generation projects to get queued they needed to acquire various licenses in a defined process under the feed-in-tariff process or technology-specific tenders.
We seem to be deviating from this with extra-LCDPD arrangements being made that will truly affect the plan.
The planning process itself is today shrouded in secrecy and not open to scrutiny despite best efforts.
Having such a vital plan open to more scrutiny in a defined process that includes all stakeholders will ensure that only the most deserving powerplants get onboarded.
The current process with undefined timelines for when the technical, oversight and ministry teams are to be done with their part is fodder for speculation.
The indeterminate timelines on when this can be publicly reviewed create an aura of secrecy, opportunities for short-circuiting, and channels for influence peddling that is not good for the sector’s perception, and efficient outcomes.
There are also uncoordinated efforts with planning for new power plants being done in other studies, whitepapers, and ad hoc decisions.
The acquisition of new power plants must switch to a more coordinated and transparent process.
A competitive tendering route has proven to lead to better outcomes in terms of pricing, visibility, investor confidence, efficiency, and reduced risk perception.
The LCPDP process can identify when and where a powerplant of a given quality is needed and regular well-designed auctions are undertaken to award projects in advance to deliver the power where it is needed.
Within this framework, template technology-specific PPAs agreed on by the off-taker, lender groups and investors can be availed for public scrutiny.
The criteria for the selection of the winners would also be publicly exposed, and the price of the winning bidders and their ownership also be revealed.
This can be done for all kinds of power plants, transmission lines, off-grid concessions, and ancillary services like battery storage.
Open competitive sourcing has led to better price outcomes and visibility.
This process would also reduce the risk for investors.
On utility performance, there should be regular, publicly accessible information on connections, units sold, units lost in theft, transmission and distribution, frequency of blackouts and their resolution, dispatched generation, the merit order of dispatch, and pricing.
We do have a partial schedule of these on the Kenya gazette each month and in the annual EPRA statistics.
Very few Kenyans access the Kenya Gazette regularly and those who do, have to weave through other non-electricity matters to reach the desired information.
The EPRA statistics especially on utility performance could be published more regularly.
Why not add these to the regulator’s website in a digestible format for Kenyans in a quarterly update? The data is available.
The better the public understands the ongoings in the electricity sector, the more accountable we can be to the public, the better decisions we make, and the more efficient and cost-effectively we supply power to consumers.
Ugandan has largely done this and has consistently been crowned as the best-regulated market in Africa.
Mark Twain once said that there are two times in a man’s life when he should not speculate: when he can’t afford it, and when he can.
We cannot afford to speculate on the availability and cost of power, and we can afford to do better in service delivery to customers, and investor retention in the sector.
Transparency offers more benefits than risks.
George Aluru is the CEO, Electricity Sector Association of Kenya (ESAK)