EPRA Licensing in Kenya: Energy and Petroleum Regulatory Requirements

EPRA licensing in Kenya decides who may generate, import, store, transport and sell energy, and which authority issues each permit. The Energy and Petroleum Regulatory Authority (EPRA) is established by section 9 of the Energy Act, 2019 (No. 1 of 2019), but the licensing map is more divided than most guides suggest. Electricity licences come from EPRA, bulk petroleum licences come from EPRA under the Petroleum Act, 2019 (No. 2 of 2019), and retail petrol stations are licensed by county governments. This guide sets out which Act applies to which activity and the penalties for getting it wrong.

Two Acts, One Regulator

Two statutes carry most of the licensing load. The Energy Act, 2019 covers renewable energy, downstream coal, electricity, wayleaves and energy efficiency. The Petroleum Act, 2019 covers upstream petroleum in Part IV and midstream and downstream petroleum in Part IX. Downstream petroleum licensing sits in the Petroleum Act, not the Energy Act, so check both statutes before you plan a project. Section 10 of the Energy Act sets out EPRA’s functions and section 11 its powers.

Electricity Licences Under the Energy Act

Section 117 of the Energy Act requires a person who wishes to carry out the generation, exportation, importation, transmission, distribution or retail supply of electricity to apply to EPRA for a licence. There is one important exception: a person does not need authorisation to generate electrical energy for own use with a capacity not exceeding one megawatt. Projects above that line need a licence, and the exemption applies to own use only, not to selling power.

Section 119 provides that an application for a licence, including an application for amendment, transfer or renewal, must be made to EPRA in the form and manner prescribed by regulations. Licences can be suspended or revoked under section 126, and licensees must keep accounts, records and reports under section 129.

Section 118 makes it an offence to carry out any electricity undertaking without a licence. The penalty on conviction is a fine of not less than KES 1 million, or imprisonment for not less than one year, or both. These are minimum penalties, not ceilings.

Petroleum Licences Under the Petroleum Act

Section 74(1) of the Petroleum Act requires a valid EPRA licence to undertake refining, importation, export, bulk storage or transportation of petroleum crude or products, and to sell petroleum in bulk for export or retail sale. A vehicle used to transport petroleum in bulk needs an EPRA petroleum permit, and a driver of a bulk tanker must be certified by EPRA.

Section 74(2) deals with retail. A person who supplies petroleum products through a retail dispensing station, or gas through a centralised reticulation system, must hold a licence issued by the County Government. The station or system must also comply with the section 86 construction permit requirements and operate in line with national guidelines published by EPRA.

Section 74(3) sets minimum penalties for contravention. A breach of section 74(1)(a), covering refining, importation, export, bulk storage and bulk transportation, carries a fine of not less than KES 10 million, or imprisonment of not less than three years, or both. A breach relating to bulk sales, bulk transport vehicles or retail stations carries a fine of not less than KES 1 million, or imprisonment of not less than three years, or both. A lower tier applies to the remaining limbs of the section, so read the subsection for the specific activity.

Section 77 requires an application for renewal of a licence, permit or certificate to be made at least thirty days before the existing one expires, with the prescribed fee. Diarise renewals well ahead of that date.

Coal and Other Energy Activities

Section 94 of the Energy Act requires a licence or permit for energy production from coal. Electricity generation using coal needs a valid EPRA licence, and a vehicle used to transport coal for energy production needs a permit. A person who intends to construct a coal-fired energy facility must apply to EPRA for a construction permit before building (section 107).

Energy Efficiency

Under section 204, EPRA specifies by rules which persons, including public bodies, must have an energy audit carried out and how often. The audit must be conducted by a certified energy auditor, who reports the result to EPRA. Section 203 deals with accreditation of energy auditors and managers. The audit cycle is therefore set by EPRA’s rules, not fixed in the Act, so check the current rules for your facility.

Appeals and Disputes

Section 24 of the Energy Act provides for appeals against EPRA decisions, and section 25 establishes the Energy and Petroleum Tribunal. A licence applicant that is refused, or a licensee whose licence is suspended or revoked, should look at the appeal route and its time limits immediately after the decision.

Planning Your Licensing Sequence

Map each activity in your business plan to its statute and issuing authority before you apply. A fuel business that imports, stores in bulk and also runs retail sites needs EPRA licences for the first two and county licences for the third, each with its own renewal date. A power developer should confirm early whether the project falls under the one megawatt own-use exemption, because that decides whether an EPRA licence is needed at all.