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The street lighting programme spearheaded by Kenya Power is grappling with significant challenges due to a mounting debt of Sh 3.5 billion owed by county governments as of February 2024.
This financial strain has hindered the sustainability and operational efficiency of the initiative, raising concerns about the long-term viability of the project.
The National Assembly Departmental Committee on Energy's report highlighted the urgency of addressing these issues to ensure that street lighting services remain effective and reliable.
The report recommends critical measures to alleviate the financial burden and streamline project management.
Introduction of a Street Lighting Levy
The report proposes the introduction of a Street Lighting Infrastructural Support Levy (SLISL).
This would be a pass-through cost included in electricity bills for all consumer categories.
The funds collected would be exclusively allocated to support street lighting projects.
EPRA, under the Energy Act, 2019, sets, reviews, and adjusts electricity tariffs. It investigates the costs involved in generating, transmitting, and distributing electricity, making sure that these costs are fair and only include necessary expenses.
The recommendation by the committee tasked EPRA with reviewing the pass-through costs and implementing this Street Lighting Infrastructural Support Levy within six months of the report's adoption.
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Delinking Development Projects from Kenya Power
The committee further advised the Ministry of Energy to expedite the transfer of government-initiated development projects from Kenya Power to the Rural Electrification and Renewable Energy Corporation (REREC).
This move seeks to allow Kenya Power to focus on its core mandate of operating as a commercial utility.
Specific recommendations include:
Immediate transfer of street lighting projects, off-grid electrification schemes, and housing electrification initiatives to REREC by the FY 2026/2027 budget.
Staggered transfer of large-scale initiatives, such as the Last Mile Connectivity Project, Kenya Off-Grid Solar Access Programme (KOSAP), and mini-grids retrofit over three years to account for existing donor commitments.
These structural changes are expected to ensure better project execution by REREC, which specialises in electrification and renewable energy projects.
It is also aimed at enhancing Kenya Power’s financial health by allowing it to operate on commercial principles.
Impact on Consumers
While introducing the Street Lighting Infrastructural Support Levy might lead to an increase in electricity bills, the proposed solution aims to provide sustainable funding for the street lighting programme.
MPs say this will benefit urban and rural areas by ensuring continuous and reliable lighting, promoting safety, and enhancing night-time productivity.
The adoption and implementation of these recommendations will require collaborative efforts between EPRA, Kenya Power, REREC, and the Ministry of Energy.
For now, the ball is in the National Assembly’s court to adopt and implement these strategies, hoping to deliver long-term solutions to Kenya’s electricity and street lighting challenges.