The Unreliable Grid

Hello! It's Brian from The Kenyan Wall Street with the latest edition of our daily newsletter. Below are our stories for the day…

The Unreliable Grid : Power Loss Soars Again…

Kenya’s electricity reliability declined in late 2024, with system losses averaging 24.2% and outages lasting 9.15 hours per month—three times the regulatory target. The Energy and Petroleum Regulatory Authority (EPRA) reported that technical losses from aging infrastructure and commercial losses from illegal connections continue to strain the grid.

Power outages can be expensive. Apart from the inconveniences that occur amid productive activities, high loss rates devalue purchased power and these costs can be added to customers' bills. Experts estimate that reducing losses to 14.5% could save consumers KSh6 billion annually. Efforts such as smart meters and Public-Private Partnerships (PPPs) have been introduced, though public acceptance remains a challenge. Businesses continue to bear the brunt of unreliable power, impacting production and economic growth.

Fueling the Telco Tussle…

The International Finance Corporation (IFC) is lending KSh 9.054 billion (US$70 million) to Airtel Kenya as part of a US$100 million financing package for Airtel Africa’s East African operations. The funds will support network expansion, infrastructure upgrades, and debt refinancing, helping Airtel compete with market leader Safaricom. While Airtel Kenya’s asset-light model reduces capital expenditure, it limits network reach, making expansion crucial. The company’s market share has grown to 30.15%, driven by aggressive coverage expansion and improvements in service quality. Additionally, Airtel Money continues to gain traction, with subscriber growth reaching 8.9% by the end of last year.

Equity Bank : An AI-Driven Fight Against Fraud, Financial Results

Equity Group has deployed AI to combat fraud, enhancing security in collaboration with the Communications Authority and the DCI. The bank has being in the headlines several times last year, implicated in fraud schemes that saw a lot of cash getting stolen. CEO James Mwangi highlighted that AI-driven fraud detection has led to a 30% reduction in cases.

Financials :

🔺 The bank reported a 17% rise in profit before tax to KSh 60.7 billion, with after-tax profit at KSh 48.8 billion.

🔺Regional subsidiaries contributed significantly, with Rwanda’s profit growing by 30% and Uganda’s by 186% year-over-year.

🔺Equity also proposed a dividend of KSh 4.25 per share.

Insight : Fintech Customers Now Take Cyber Security Seriously, But Threats Remain

As cyber threats and cyber security tools evolve, 97% of consumers in Central and Eastern Europe, the Middle East, and Africa (CEMEA) now take steps to secure their online transactions, according to a new study by Visa. Here are the details»»»»»

On your watchlist

Also Read

• Startups. Lipa Later, a fintech that offers consumer credit and e-commerce solutions for merchants, has been placed under administration two years after it acquired struggling e-commerce platform Sky.Garden for US$1.6 million.

• Energy. The consumption of fuel and other petroleum products grew 2% in 2024, an increase attributed to the growth in demand of AVGAS, Jet A1, Fuel Oils and Lubricants, according to Petroleum Institute of Africa (PIA).

• Aviation. Listed carrier Kenya Airways (KQ) has posted a net profit of KSh 5.4 billion for 2024, up from a KSh 22.68 billion loss in 2023, breaking a decade-long spell of losses.

Yesterday's Poll Results 

Do you think the CBK would create a better loan pricing system than the one used currently?

🟨🟨🟨🟨🟨⬜️ Yes (46%)

🟩🟩🟩🟩🟩🟩 No (54%)