The paper presents and analyses the main causes of high failure rate of Terminal Distribution Transformers (TDTs) in Kenya. These transformers are the most susceptible to faults emanating from lightning strikes and associated overvoltage. Over a period of time and more recently, the failure rate of the TDTs have been on an upward trend despite the standard earthing and protection systems being provided. Failed TDTs are quickly replaced without due diligence for innovative ideas to prevent future failures leading to huge revenue loss for Kenya power and electricity consumers. This research therefore provides an innovative solution for TDTs by extending the Medium Voltage (MV) power line one span away from the TDT where installation of Terminal Surge Diverters Earth (TSDE) and Terminal Medium Voltage Earth (TMVE) are done. The results show that with the adoption of this innovative arrangement, the failure rate of TDTs have reduced significantly.