Kenya is emerging as a leader in the global clean energy landscape, having recently hosted the inaugural Africa Climate Summit in Nairobi in September 2023. The country has made great progress on renewable energy and access to electricity, with renewables accounting for nearly 90% of energy generated and consumed in 2021, up from around 75% in 2017. Access to electricity has more than doubled over the past decade from 37% in 2013 to 75% in 2022. According to the IEA, Kenya is on track to provide electricity to its entire population by 2030, in line with national plans to achieve universal access. The Kenya Vision 2030 sets out a long-term development blueprint aiming to transform Kenya into “a newly-industrialising, middle income country providing a high quality of life to all its citizens in a clean and secure environment.” Under this vision, development of new and renewable energy sources, energy efficiency, and increasing electricity access are key focus areas, indicating ambition to provide greater support in accelerating towards clean energy and access targets.

Energy efficiency has and continues to play a critical role in improving living standards around the world and is the first and best response to simultaneously meet affordability, supply security and climate goals. As Kenya looks to drive forward its clean energy transition, following the impacts of the global pandemic, climate and energy crises there is a growing role for energy efficiency in delivering benefits that can ensure affordable, reliable access to electricity while supporting greater integration of renewable energy technologies. Mobilisation of investments  to promote energy efficiency in buildings, appliances, clean cooking and electricity system losses will be key to building reliable, modern energy systems that can help Kenya develop its economy. The potential of energy efficiency to create jobs, improve health, and increase social mobility and gender equality highlights its potential role in delivering benefits beyond the transition to clean energy.

During the IEA’s 8th Annual Global Conference on Energy Efficiency, held in Versailles, France, in June 2023, His Excellency Mr Davis Chirchir, Minister of Energy and Petroleum of Kenya, announced that the 9th Annual Global Conference would take place in Nairobi in June 2024. This followed Kenya's joining the IEA as an Association Country, demonstrating its deepening engagement with the Agency on energy and climate issues. Kenya is well placed to leverage its position as a leader in the global clean energy landscape, providing an example to other countries across the continent on how to accelerate energy efficiency action to navigate the dual energy and climate change crises. This report aims to provide an overview of current progress in energy efficiency in Kenya and its potential for improving people's lives through delivery of a sustainable, modern energy system.

Access to clean, secure and affordable modern energy services has not kept pace with the continent’s expanding needs, with growth in the use of electricity lagging behind growth in energy demand in the decade from 2010 to 2019. Affordability of basic services is an important concern in many African countries, where many households still lack access to basic needs such as space at a comfortable temperature. Ownership levels of appliances, such as fans, air conditioners and refrigerators, are far below the average of other emerging and developing economies. For example, only around 5% of households in sub‑Saharan Africa are equipped with an air-conditioning unit, compared with more than 85% in Japan, Korea and the United States. Uncertainties over economic prospects and energy prices have limited opportunities for investment in energy infrastructure projects in Africa, with low levels of investment in absolute terms despite enormous access needs and significant long-term projected growth in energy demand. Energy investment on the continent accounts for just 3% of global totals, with a cost of capital at least two to three times higher than in advanced economies limiting overall investment.

An enhanced focus on energy efficiency will be essential for supporting sustainable economic growth in Africa, addressing increases in energy demand and carbon emissions and furthering progress towards universal electricity access and affordability. Investment in energy efficiency, electrification and renewables for end use in Africa has been relatively static for more than five years, with many countries still lacking integrated and comprehensive policy frameworks. According to IEA analysis, energy efficiency spending could increase to around USD 43 billion annually, from slightly below USD 6 billion in the last five years, with a sevenfold increase in energy efficiency spending in areas including efficient green buildings and consumer appliances. However, financing energy efficiency projects can be challenging, and while many projects are cost-effective and result in savings, they are relatively small scale, there is low awareness of potential savings, risks are perceived to be high, and proven business models are inadequate. 

Kenya is an emerging leader in the global clean energy landscape, with renewables accounting for nearly 90% of energy generated and consumed in 2021. It has also made strong progress towards achieving universal access to electricity, doubling electricity access from 32% in 2013 to 75% in 2022. This includes increasing access to electricity to over 97% of the urban population and 68% of the rural population in 2021, and according to the IEA, Kenya is on track to provide electricity to its entire population by 2030. Electricity demand in Kenya has increased in the past few years, marked by a 9% increase in demand for electricity and 3% increase in peak electricity demand in 2021 with expansion in GDP of about 8%.

The government of Kenya has set out a range of strategies and plans aimed at achieving universal energy access and 100% renewable power by 2030. The Kenya Vision 2030 sets out a long-term development blueprint aiming to transform Kenya into “a newly-industrialising, middle income country providing a high quality of life to all its citizens in a clean and secure environment.” Under this vision, development of new and renewable energy sources, energy efficiency, and increasing electricity access are focus areas in the strategy for Deploying World Class Infrastructure Facilities & Services, indicating intentions to provide greater support for addressing energy demand to facilitate greater integration of renewable energy.

As part of the Energy Efficiency in Emerging Economies (E4) Programme, this report aims to provide an overview of current progress in energy efficiency and its potential for improving people's lives through delivery of a sustainable, modern energy system. The report assesses progress, opportunities and challenges for energy efficiency across four key areas: Buildings, Appliances, Clean Cooking and Electricity System Losses. These areas have been prioritised because buildings and appliances account for the majority of Kenya's total energy consumption and are expected to drive the majority of growth in electricity demand in the next decade. Improvements in the energy efficiency of these sectors will play a key role in allowing Kenya to meet its universal electricity access and renewable energy targets, while at the same time unlocking new opportunities for demand side system flexibility and digitalisation.

1)    Buildings: The buildings sector is the dominant energy consuming sector in Kenya, accounting for around three-quarters of total final energy consumption. Demand will continue to grow as the sector expands over the coming decade, with total building stock expected to increase by over 25% between 2018 and 2025. Actions taken to address buildings efficiency will play a pivotal role in the country's clean energy transition, with current efficiency improvements not adequate to outpace demand growth. To improve the energy efficiency of the building stock, Kenya is seeking to enhance the energy performance of new buildings and improve the energy performance of existing buildings. This analysis explores the potential for further enhancing efficiency through inclusion of minimum energy performance requirements for common building types and provisions for "grid-readiness" that include installation of solar PV, battery storage and chargers for electric vehicles.

2)    Appliances: Electricity consumption from light industry, appliances and cooling systems in Kenya could quadruple through to 2040, emphasising the need for improved energy efficiency standards and action on dumping of inefficient appliances. To address growing future demand, Kenya aims to increase the energy efficiency of household electrical appliances through the implementation of minimum energy performance standards (MEPS). Looking at MEPS across the region, there is room for more adoption of more ambitious performance levels using known technologies that are widely available today. Kenya also faces the challenge of addressing dumping of low-energy-efficiency and obsolete household appliances, such as refrigerators and air conditioners. Import of these appliances results in increased energy bills, higher energy demand and strain on grids as cumulative use increases. This report aims to discuss barriers to adoption of improved energy efficiency standards and highlight their potential for expanding the domestic market for efficient-energy appliances in support of long-term goals.

3)    Clean cooking: Over 80% of the Kenyan population still relies on traditional biomass fuels for cooking, highlighting the role of clean cooking solutions in improving energy access and living standards. Traditional cooking methods using biomass can lead to significant health issues as a result of air pollution, are a contributor to deforestation, and enhance food stress that disproportionately affects women and girls. Liquefied petroleum gas (LPG) is a leading solution in urban areas; however, increasing prices for LPG in Kenya have impacted affordability, increasing the risk of people switching back to traditional fuels. Kenya remains committed to improving energy efficiency and reducing pollution caused by household thermal cooking applications. Kenya has set out a target of reducing over‑reliance on wood fuels while providing access to electricity and modern cooking solutions to all households by 2028. This analysis provides recommendations for actions that could be developed in the very short term to support continued adoption of clean cooking fuels and technologies in Kenya that can ensure affordable access.

4)    Electricity system losses: Investments in resilient and efficient power grids will be critical to meeting Kenya’s growing energy needs while supporting universal access goals, with the country currently facing high rates of power losses of almost one-quarter. Current levels of electricity system losses are over 23%, compared with a global average of 8%, increasing the challenge of supplying energy to a growing demand base. Improving system efficiency reduces the need for costly investments in additional generation capacity and helps bring down electricity bills. This analysis discusses short-term actions to reduce losses in the distribution system, including improvements to regulations and monitoring, implementation of efficiency standards for distribution transformers and adoption of new financing and business model approaches. It also explores the potential for digitalisation and smart approaches as a solution for enhancing electricity system efficiency.

Energy efficiency is a relatively low-cost solution that can temper demand growth, reduce the strain on existing transmission and distribution infrastructure, support increased rates of access to electricity, and improve affordability. As demand for, and access to, electricity in Kenya increases, policy makers need to ensure that appropriate measures are introduced to limit impacts on overall affordability. Managing this balance effectively will require measures to boost energy efficiency in buildings, support access to efficient appliances and cooking solutions, and ensure adequate power system investment in actions to electricity system losses.

This report gives suggestions on potential policy actions that can be taken to enhance progress, drawing on case studies and examples from Kenya and other countries in Africa and globally. The report also explores the potential of digitalisation for unlocking new opportunities as well as the importance of ensuring an inclusive energy transition that provides economic opportunity and improves livelihoods, especially those of women and children. Recommendations follow the IEA policy package approach for energy efficiency, built on the foundation of three essential elements: regulation, information and incentives.