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A 462km high voltage power line between Nairobi and Mombasa has been scheduled for completion in June this year
The 400kV transmission line being constructed by the Kenya Electricity Transmission Company (Kentraco) is set to cost US$179mn.
Kentraco aims to transmit electricity generated in the coast to Nairobi with a transfer capacity of 1,500MW.
A change in policy, however, would allow private power generation companies in solar and biogas subsectors to sell power to the national grid.
Under the new policy released by the Energy Regulatory Commission (ERC), which came to effect in December 2012, suppliers to the national grid will earn US$0.12 per kilowatt hour (kWh).
Investors, however, will be required to run projects generating a minimum of 0.5MW to 40MW.
Currently, those selling power to consumers directly are allowed to charge US$0.12 per kWh, an incentive aimed at promoting power generation in areas where the national grid does not reach.
Suppliers of biogas power are set to earn US$0.11 kWh up from US$0.08 under the previous tariffs.