A National Electrification Strategy has been funded by the World Bank. The strategy applies GIS techniques to pinpoint areas suitable for grid and off-grid electrification and identifies the funding required to achieve universal access by 2022.

**Table 4. Regulatory framework for electricity access in Kenya and comparators, 2015**

||Kenya|Senegal|Tanzania|Uganda|International<br>benchmark|
|---|---|---|---|---|---|
|**Energy Access Regulation**|81%|28%|81%|65%|56%|
|_Regulation of New Connections_|75%|50%|94%|79%|65%|
|_Regulation of solar home systems_|100%|0%|50%|50%|66%|
|_Regulation of mini-grids_|67%|33%|100%|67%|44%|

Note: Scores based on index developed for the Rethinking Power Sector Reform Project. For more details go to project website at http://www.esmap.org/rethinking_power_sector_reform

# _3.2.3 Summary_

In summary, Kenya’s long-term electricity access trajectory reveals steady growth at an increasing pace, with strong recent progress in both grid electrification and off-grid access. Since 2006, Kenya has maintained a firm political commitment to the goal of universal access, backing it up with significant financial resources and a good regulatory environment. The pace of grid electrification appears to have accelerated dramatically in the past five years, and Kenya’s efforts to promote minigrid and off-grid electrification continue to pay off.

# **_3.3 Utility efficiency_**

# _3.3.1 Performance_

Before unbundling began in 1997, five state-owned entities owned power generation stations and transmission lines in Kenya. KPLC was one of them. A listed company with a government majority shareholding, KPLC operated as a vertically integrated utility, buying power in bulk from the other and supplied power to end-users. KPLC also imported power from Uganda under a contract between the Uganda Electricity Board, as it was then known, and one of the other Kenyan entities, KPC. This structure posed challenges, mainly around the high level of complexity in the system. Financial functions overlapped among the five key players, accompanied by recurrent disputes over asset ownership, unclear lines of responsibility for debt servicing, ill-defined lines of responsibility around the timely development of new generation facilities, and electricity tariffs that were not costreflective. Nevertheless, KPLC was a relatively strong performer in the region when it came to financial and technical efficiency, and the utility’s governing principles and structures were not completely out of line with the corporate and commercial tenets set out in the “standard reform model” that was taking hold. However, the sub-sector as a whole depended on external sources of funding for system expansion and development, and—under embargo—KPLC’s performance deteriorated in the 1990s, along with the country’s reserve margin.

When the structural reforms began in 1996, KPLC had already undertaken efforts to bring tariffs closer to long-run marginal costs and was initiating staff rationalization processes. Following the unbundling of generation functions (which were designated to KenGen), KPLC’s performance balanced that of KenGen’s relatively poor performance, buoyed by the increase in tariffs to 75 percent of long-run marginal costs. However, this quickly changed with the onset of a critical 26