Impact of Energy Sector Reforms on Electricity Penetration in Kenya Relative to Other Reforming Developing Countries

Abstract

There are observable improvements in Kenya’s electricity sector since the mid 1990s. Among these are increase in electricity generated and an increase in number of households and institutions connected to the grid. These milestones have been achieved during the reform period.  To find out whether these achievements are attributable to the reforms or not is the subject of this paper. This paper carries out an econometric evaluation of the impact of electricity sector reforms in Kenya relative to other four developing countries using panel data over the period 1993 to 2018. The paper assesses the impact of restructuring, unbundling, competition and private sector participation on electricity access. Using fixed effect method the study concludes that competition is key in enhancing access to electricity nationally and in both rural and urban areas. On the other hand, restructuring has a negative impact on both electrification in the four countries under study. Allowing more players in the sector would therefore improve the power industry outcomes.

Key words: Power sector, Reforms, Electrification, Fixed effect method, Developing countries

DOI: 10.7176/JRDM/90-06

Publication date: February 28^th 2023