The World Bank Group’s subsidiary, International Finance Corporation (IFC) has announced plans to support the Kenya Power and Lighting Company (KPLC) in implementing a set of loss reduction measures.
According to a company press release, this move is an attempt to reduce the technical and commercial losses experienced by the power utility, which are currently around 19%.
The advisory engagement is expected to catalyse investment in clean energy generation, transmission and distribution as well as other related infrastructure in Kenya.
Technical losses casing inefficiency
The finance institution highlighted that efforts by the utility to reach more customers have placed increased pressure on its operating systems, resulting in higher losses.
Technical losses are said to result from inefficient, older equipment or obsolete, whereas commercial losses stem from challenges with unauthorised energy usage, fraud and other technical challenges.
“Currently KPLC is implementing a company-wide Loss Reduction Strategy which includes; deploying smart metering infrastructure, load analysis to identify technical losses across the network, proper measurement of losses, installation of low-loss transformers and reactive power compensation among others,” Kenya Power’s acting managing director and chief executive officer, Dr. Ken Tarus, stated.
Tarus added: “Kenya Power intends to leverage on this global experience of IFC to ensure we get it right.”
Through the new project, IFC will advise KPLC on reducing technical and commercial losses, as well as training and capacity-building.
The project builds on a previous advisory engagement, led by IFC, which identified specific actions to be made by KPLC to combat losses.
This current initiative is to support KPLC with the implementation of these measures, and will be complemented by efforts from other development partners, the company statement said.
KPLC to become more efficient
IFC country manager for Kenya, Manuel Moses, commented: “This advisory engagement is part of IFC’s continued support to ensure that KPLC can become more efficient and effective at providing electricity services across Kenya.
“IFC will bring experiences from its work in different markets to help reduce KPLC’s technical and commercial losses.”
According to the finance organisation, across sub-Saharan Africa, national electricity grids are characterised by poor transmission capacity and inefficiencies, averaging 23% in losses across the entire region.
As such, the financier intends to implement similar loss reduction initiatives in other utilities in the region as a means to improve operational efficiencies, contributing to better financial viability of these companies, which is essential for private investment.