Kenya Triples Renewable Energy Target, Adds Nuclear to Mix
Kenya raises renewable capacity goal to 5,500 MW, including nuclear, but affordability remains a challenge.
Kenya has significantly raised its long-term renewable energy ambitions, tripling its target from 1,500 megawatts (MW) to 5,500 MW. The expanded plan, announced by the state-owned utility KenGen, includes 2,000 MW of nuclear power, 700 MW of hydropower, and additional geothermal projects. The move is intended to meet surging electricity demand and support the country's industrialization drive.
Kenya already generates 93% of its electricity from renewable sources, making it a global leader in green energy. However, experts caution that expanding capacity alone may not lower electricity bills. The country's industrial consumers currently pay between $0.18 and $0.23 per kilowatt-hour, far higher than rates in South Africa, Egypt, Morocco, and Ethiopia.
KenGen CEO Peter Njenga said the recalibrated pipeline reflects a new growth trajectory. Lawmakers have been pushing for lower electricity rates, and in July, parliament directed Energy Minister Opiyo Wandayi to develop a policy for renegotiating power purchase agreements with independent producers. These producers supply about 40% of Kenya's capacity under long-term contracts, some of which include "take-or-pay" clauses that obligate Kenya to pay for electricity even when it is not fully used.
Energy analysts argue that the real issue is not generation capacity but system efficiency. Mugwe Manga, climate finance lead at FSD Kenya, noted that more than 20% of electricity is lost to technical failures and illegal connections, compared with a global average of 8-10%. He called this a "low-hanging fruit" for reducing costs. High financing costs for renewable projects in Africa, driven by perceived risks, also push up consumer prices.
Kenya provides limited direct subsidies for electricity, unlike countries such as Morocco, Egypt, and China. Consumers bear the cost of infrastructure, transmission losses, taxes, and currency fluctuations. Kenya Power CEO Joseph Siror defended current pricing, saying it reflects infrastructure and tariff structures.
Proposed open-access market reforms could allow large consumers to buy electricity directly from generators, potentially increasing competition. Cynthia Angweya-Muhati, CEO of the Kenya Renewable Energy Association, stressed that the success of the new targets will depend on whether clean generation growth is matched by reforms that actually lower costs for consumers.