Regulatory and policy risks: Analyzing the uncertainties related to changes in government policies, regulations, and incentives affecting solar power project development and operations in Kenya

Abstract

This research paper examines the regulatory and policy risks associated with solar power project development and operations in Kenya. Through an extensive literature review, interviews with stakeholders, and case studies of solar power projects, the study identifies key uncertainties and challenges that affect the sector. The findings highlight several critical risks, including policy inconsistency, complex licensing and permitting processes, uncertainties in tariff structures and power purchase agreements, land acquisition challenges, and grid connection issues. The research underscores the importance of strengthening policy frameworks, streamlining regulatory processes, and enhancing transparency and predictability in tariff structures and power purchase agreements. The paper provides valuable insights for policymakers, industry experts, and project developers, emphasizing the need for stable policies, a streamlined regulatory environment, and clear guidelines to attract investment and accelerate the growth of solar power in Kenya. By addressing these risks, Kenya can unlock its solar power potential, contribute to sustainable development, and advance its renewable energy targets.