In Sessional Paper No. 4 of 2004 on Energy, the Government indicated the need to fully un-bundle the transmission and distribution functions of Kenya Power and Lighting Company, but on further review, it was decided that a separate company wholly owned by the government and funded by the exchequer be created to construct future additional transmission lines.
Unbundling KPLC would have been challenging owing to its status as a publicly quoted company. The Government therefore registered The Kenya Electricity Transmission Company Limited in November 2008. The new company’s core functions are: to plan, design and construct, own, operate and maintain high-voltage electricity transmission lines and fiber optic cables. KPLC retained and continue to operate all previously existing transmission systems.
Creation of the Kenya Electricity Transmission Company Limited was necessitated by the desire of the Government to transform power transmission into open access system to allow large electricity customers to purchase power from generators.
With future interconnections of Kenya’s electricity grid with Ethiopia, Tanzania and other Southern Africa Power Pool (SAPP) countries, and strengthening of the interconnection with Uganda through the Nile Equatorial Lakes Countries Electric Grids Interconnection Project (NELSAP), the Government views open access as having potential to enhance market and supply options for both power generation and large consumers.
Creation of the company also aimed to shield electricity consumers from higher tariffs in future arising from construction of this expensive power transmission infrastructure. Projects undertaken will be fully funded by the Government and no capital related expenses will be passed on to the consumer. Thus the transmission company will contribute to improvement of power quality, supply and affordability.