Before Kenya's net metering rules existed, financing a commercial or industrial solar installation meant underwriting a specific kind of ambiguity: what happens to the power a system generates when the building it sits on doesn't need it in that exact moment? Lenders don't like ambiguity, and they price it. The Energy (Net-Metering) Regulations, gazetted by the Energy and Petroleum Regulatory Authority, removed a meaningful chunk of that ambiguity from every C&I solar financing that followed.
The Problem the Rules Actually Solved
Before these rules, developers structuring rooftop or captive solar for larger commercial customers faced a genuine technical and financial dilemma: either over-size battery storage to absorb every unit of excess generation, an expensive solution that made marginal projects uneconomic, or accept curtailment losses that were hard to model with any confidence. Financiers, in turn, had to underwrite that ambiguity directly, which added a real risk premium to financing costs regardless of how strong the underlying project fundamentals were.
Clear export terms don't just help a solar developer, they help every lender downstream who has to model that developer's cash flows for the next ten years.
What Changed, Concretely
- Standardised terms for exporting excess generation back to the grid removed a major source of underwriting ambiguity from C&I solar transactions
- Developers could size systems closer to a facility's actual daytime load profile, without needing to over-engineer around stranded excess generation
- Lenders gained a clearer, more defensible basis for underwriting the revenue side of a transaction, which shows up directly in financing cost
- The rules opened the door to a wider range of ownership and financing structures, including third-party power purchase agreement models that hadn't been financeable with the same confidence before
Why This Shows Up in Almost Every C&I Mandate We Take On Now
With clearer export terms in place, a wider range of commercial and industrial solar structures became financeable on genuinely conventional terms, not exceptions requiring special underwriting. That shift didn't make headlines the way a large wind farm commissioning does, but it has probably done more to expand the addressable market for distributed solar in Kenya than any single project announcement in the same period.
We now factor net metering economics into a growing share of our commercial and industrial advisory mandates. It has become a standard input in how we help clients size and structure distributed solar projects, quiet regulatory infrastructure that makes the more visible projects further down the pipeline actually bankable.
