Powering a Green Hydrogen Project in Kenya: Wheeling, Bulk Supply and Open Access Explained

Green hydrogen is only “green” if the electricity that splits the water is genuinely renewable, and EPRA’s own guidelines set a hard emissions ceiling to prove it: well-to-gate lifecycle emissions of no more than 1.0 kgCO2e per kilogram of hydrogen produced. For a developer without its own dedicated generation, meeting that standard means buying renewable power from a third party and getting it across the grid to the electrolyser. That is not a hydrogen-specific legal question. It runs through Kenya’s ordinary electricity market regulations, and a project structured without understanding them properly will find out the hard way that the power supply, not the hydrogen technology, is usually the harder legal problem.

Wheeling: The Mechanism EPRA’s Own Guidelines Point To

EPRA’s Guidelines on Green Hydrogen and its Derivatives contemplate exactly this structure. Under section 1.4.1(c), a developer may source power by entering into a power purchase agreement with a renewable generator and having that electricity “wheeled using the Grid from the renewable energy plant to the electrolyser.” Wheeling means the electricity physically moves across the transmission or distribution network owned by a licensee that is not a party to the power purchase agreement, in exchange for a separate wheeling charge paid to the network owner. This is not a new mechanism invented for hydrogen. It is the existing open access regime under the Energy (Electricity Market, Bulk Supply and Open Access) Regulations, 2024, and a hydrogen developer needs to work within it rather than assume a bespoke arrangement will be created for the project.

Open Access: Who Qualifies, and the Load Threshold That Matters

Regulation 7 of the 2024 Regulations requires a transmission or distribution licensee to provide non-discriminatory open access to its network for use by any licensee or eligible consumer, on payment of the applicable wheeling or use-of-system charges. Regulation 33 sets the eligibility threshold that determines whether a given project can use this route at all: a minimum load of not less than 1MVA for distribution-level open access, or 10MVA for transmission-level access. An industrial-scale electrolysis plant will typically clear the distribution threshold comfortably and may clear the transmission one, but this is a figure to confirm early, since a smaller pilot or demonstration facility could fall short of it and need a different supply structure entirely. The application itself follows a prescribed format under regulation 32, and the Authority is required to determine bulk supply applications within thirty days of receipt under regulation 20.

Bulk Supply Contracts Follow a Prescribed Format, Not a Freely Negotiated One

Where the arrangement is structured as bulk supply, meaning one licensee supplying electrical energy to another licensee for onward supply, regulation 27 requires the contract to follow the format set out in the Third Schedule to the Regulations. This matters for deal timelines: the commercial terms a developer might expect to negotiate freely, duration, tariff structure, capacity commitments, metering and dispute resolution, are constrained by a regulatory template rather than open to the same drafting flexibility as a purely private commercial contract. A developer’s legal and commercial teams should map the Third Schedule requirements against the project’s actual power needs before finalising a term sheet with a generator, not after.

A Regime in Transition: What to Verify Before Relying on Any Tariff Assumption

Kenya’s renewable power procurement framework has historically run on two tracks, the Feed-in-Tariff Policy 2021 for smaller hydro, biomass and biogas projects up to 20MW with standardised long-term power purchase agreements, and the Renewable Energy Auctions Policy 2021 for solar, wind and larger renewable projects, procured through competitive bidding. Neither policy was written with a captive industrial offtaker like an electrolyser in mind, and both were reported in early 2026 to be under active revision as EPRA moves toward a more fully auction-based procurement model. Given how recently that reported change occurred relative to this article, a developer should confirm the current state of the tariff and procurement framework directly against EPRA’s own current guidance before pricing a power purchase agreement on the assumption that either the legacy Feed-in-Tariff or Auctions Policy terms still apply unchanged.

Self-Generation Is the Alternative, and the Regulations Are Silent on It

A developer that builds and owns its own renewable generation avoids the wheeling and bulk supply framework for that portion of its power needs, but does not avoid EPRA licensing. Generating, transmitting or distributing electricity as part of the project still requires a power undertaking licence from EPRA, processed within a stated 60-day period. Notably, the 2024 Regulations we reviewed contain no dedicated captive-power or self-generation exemption provisions, meaning a developer combining self-generation with grid-connected top-up supply is likely operating across two different regulatory tracks simultaneously, generation licensing for the owned plant and open access or bulk supply rules for anything drawn from or exported to the grid, rather than a single unified permit.